Sandy Holds Back US Consumer Spending, Pay in October
WASHINGTON (AP) – Americans cut back on spending last month and saw no growth in their income, reflecting disruptions from Superstorm Sandy.
The Commerce Department says consumer spending dropped 0.2 percent in October. That’s down from an increase of 0.8 percent in September and the weakest showing since May. Income was flat in the month following a 0.4 percent rise in September.
The government said work interruptions caused by the storm reduced wages and salaries by about $18 billion at an annual rate. The storm affected 24 states, with the most severe damage in New York and New Jersey.
The figures suggest economic growth will likely be weak in the October-December quarter. Consumer spending drives nearly 70 percent of economic activity.
Copyright 2012 by The Associated Press. All rights reserved. Material may not be redistributed.