US households saved some $1.1 trillion less than previously thought over the past six years, according to revised government data released Thursday.
As part of a comprehensive update of some of the nation’s most-important economic statistics, the Bureau of Economic Analysis now calculates that Americans stashed away an average 8.3% of their disposable income annually from 2017 through 2022, down from a previously estimated 9.4%. The reduction stems from an accounting adjustment that lowered personal income from mutual funds and real estate investment trusts.
Americans were able to build up extra savings during the pandemic, in part thanks to large government support, but have since seen that eroded by elevated inflation and a return to more normal spending patterns as fears of Covid-19 receded. Much of the reduction in personal savings seen in the revised data occurred prior to the pandemic, so its implications for how much extra cash Americans may feel they still have now is not clear cut.
But the recovery since then has been somewhat slower, according to the update. Growth last year was revised to 1.9% from 2.1%.The report also offered some insight into one of the economy’s many puzzles: the significant divergence between GDP — the total value of all goods and services produced in the economy — and gross domestic income, which calculates all income generated from producing those goods and services.
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