What Has Been Happening to U.S. National, Business, and Personal Saving Rates Over Time?
As mentioned, the personal saving rate (saving as a percent of ” disposable” after-tax income) has plunged over the past 15 years, from about 9 percent in the mid-1980s to nearly zero in 2000. Personal saving has also fallen as a share of GDP. Business saving has scarcely changed as a share of the economy, so total private saving has declined as a share of GDP. Over the same period, the federal budget has moved from substantial deficits to substantial surpluses, and state and local government surpluses have risen, boosting government saving as a share of GDP. The total national saving rate, the sum of these components, has recovered from a dip in the 1990–91 recession to regain its 1989 prerecession level and is about at the level of the mid-1980s. It has not, however, regained the levels of earlier decades, as when it averaged 20.3 percent of GDP between 1960 and 1982. [See Figure 3] In dollar terms, of course, the current saving rate represents a greater absolute amount or level of s
