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Incomes and Spending Drop in March

Reflecting heavy layoffs, personal incomes fell 0.3% in March, the second consecutive monthly decline, according to the Commerce Department. In addition, the government said consumer spending fell 0.2% in March, following two straight months of gains. The figures point to an economy that is still struggling to emerge from the recession. After-tax incomes were flat in March, leaving the personal savings rate unchanged at 4.2%. That is a big improvement over March 2008, when the rate was near zero. Households have been cutting back on spending and boosting savings during the past half year due to layoffs, shrinking stock portfolios and anxiety over the sluggish economy.

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Date Last Updated: 05/07/2009