29 October 2012 19:00 [Source: ICIS news]
In its monthly report on personal income and outlays, the department Bureau of Economic Analysis (BEA) said that personal consumption expenditures (PCE) – the department’s term for consumer spending – rose by 0.4% in September from August.
While the advance was narrow, it showed more strength than the razor-thin 0.1% gain in PCE reported for August.
The September report also showed that disposable personal income (DPI), that is take-home pay after taxes, rose by 0.4% last month, also a better showing than the 0.1% edge seen in August for DPI.
Private sector employers increased wages and salary disbursements in September by $19.5bn (€15bn), BEA said, a nearly four-fold increase over the $4.1bn payroll gain seen in August.
Within the wages and salaries data, goods-producing industries saw payrolls increase by $4.9bn last month, a marked improvement from the $7.2bn decrease reported in August.
Manufacturing payrolls rose by a modest $500m in September, the report said, but it was a much better result than the $6.3bn in manufacturing payroll losses in August.
Although wages are rising, so too are prices, and the department said that its measure of workers’ “real” disposable income fell by less than 0.1% in September as increased costs of goods and services ate away at what otherwise would have been a 0.4% DPI advance.
Real disposable income had fallen by 0.3% in August.
In another indication of slowly growing consumer confidence, the department said that US workers put 3.3% of their disposable income into savings accounts. That is somewhat less than 3.7% personal savings rate seen in August and a sign that US wage-earners are becoming less worried about economic rainy days.
The overall US economy saw growth of 2% in the third quarter this year, a still sluggish pace but better than the second quarter's 1.3% expansion.
($1 = €0.77)
Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy
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