Government social benefits to persons, a drag into 2022?
There was a recent Axios article about how government benefits will be a drag going into 2022.
However, this ignores the fact that the largest increase in government transfers, the economic impact payments took place in Q1/Q2, and expanded unemployment benefits ran out in Q3.
Q4 experienced 6.9% quarter-over-quarter growth (SAAR) despite government social benefits to persons falling from 20.6% of personal income to 18.6% of personal income from Q3 into Q4.
Year-over-year there will be a decline in benefits, but the growth in compensation of employees more than offsets it - and the growth in Q4 alone shows how small the effects of the declining government benefits will be.