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RJ & Makay

Our view of news, events and human capital trends in the financial services industry.
Tags >> Personal income

Consumer spending up sharply on pricier gas

Posted by RJ and Makay on Mar 28, 2011

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Consumer spending up sharply on pricier gasAfter a severe recession, an increase in consumer spending would normally be cause for celebration because it suggests the economy's improving. But the 0.7% spike just reported for February by the Commerce Department isn't impressing many people, even though it's the largest consumer spending gain in four months.

Why? People spent more in February mainly because gas got a lot more expensive. In fact, half of February's 0.4% inflation uptick was due to energy costs, and economists worry that if those costs keep going up, they'll cut into household budgets enough that consumers won't be able to spend on items associated with economic growth.

Private income drops to historic lows in Q1

Posted by Darin Manis on Jun 01, 2010

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According to a USA TODAY analysis of Scales of Justicegovernment data, private business paychecks shrank to their smallest share of personal income in U.S. history during Q1 this year. Meanwhile, during the same quarter, benefits provided by the government such as Social Security, unemployment insurance, food stamps and other programs reached a historic high.

This brings focus to a long-term trend which has been recently accelerated by the economy and the government's efforts to help dull pain inflicted by such a long and deep recession.