Facebook Pinterest Search Icon SourcingJournal_horiz Tumbler Twitter Shape photo-camera graph-trend Shape latest-news icon / user

Personal Income Growth Slowing in U.S.

Join Theory, Google, H&M, McKinsey, Foot Locker, Lafayette 148, LL Bean, the Retail Prophet and more at Sourcing Journal’s Virtual Sourcing Summit, R/Evolution: Overhauling Fashion’s Outmoded Supply Chain, Oct 14 & 15.

After rising for many months during 2014 and the first few months of 2015, monthly U.S. disposable income growth has stabilized and tapered off, tempering consumer spending and saving, according to data released last week by the U.S. Department of Commerce.

Personal disposable (after-tax) income jumped 4 percent for the second straight month in May on a 12-month smoothed basis, slightly below the 4.1% increases of January, February and March, but well above the monthly increases seen in 2013 and most of 2014 as employers continued to add people to their payrolls and unemployment improved.

However, consumer spending, that important driver of economic growth, rose by only 3.6% compared to the same month last year, to an annualized $12.2 trillion.

Spending has been growing in recent months, but at a slightly declining rate.


The savings rate, or percent of disposable income socked away in savings and investment, dropped to 5.1% in May from 5.4% in April.


Surges in spending on durable goods and services, which gained 5 percent and 4.5%, respectively, were more than offset by sluggish nondurables spending, which rose by a negligible 0.3%.


Within nondurables spending, apparel and footwear held their own in the month, rising by a collective 2.7% on a 12-month smoothed basis. 


Related Articles

More from our brands

Access exclusive content Become a Member Today!