Consumers have shaken off the economic shock of Sept. 11,
based on the U.S. Commerce department's latest personal income and consumer spending figures, released Thursday morning.
Personal income increased 0.4% in December, a more than 5% annual rate. This is the strongest showing since July and is the first increase since August. It was driven by increased payrolls in distribution and service industries.
In contrast, consumer spending fell 0.2% in December as the surge in car sales subsided from zero percent financing incentives. The figure is still 0.7% higher than August. Purchases of non-durable goods, the main source of freight for dry vans, were unchanged in December after declining for three months. Non-durable purchases are still 1.1% below August.
In the fourth quarter, consumer spending rose by a surprisingly strong 5.4% and was one of the main factors in a 0.2% rise in the country’s gross domestic product in the final quarter of 2001.
Also released Thursday morning were figures from the U.S. Labor Department that indicated the number of workers filing for first time unemployment benefits dropped over the past four weeks.