Personal incomes slip but savings increase
The personal income of Americans rose just 0.2 percent in August and personal spending fell, the result of the telephone strike, hurricane damage, and other factors, the Commerce Department said Tuesday. Personal spending, which provides much of the fuel for the economic recovery, slumped 0.3 percent in August, the biggest decline since June of 1982.
At the same time, Americans increased their savings in August. The savings rate recovered to 5.2 percent of disposable income after dipping to as low as 4 percent in May. New housing construction jumped 8.4 percent in August to reach the highest level in more than 41/2 years, the deparment said Monday.