Consumer spending rebounded in August as employment gains revived household earnings growth and encouraged Americans to return to shops and car dealerships.
The 0.5 percent increase in purchases was more than forecast and followed little change in July, Commerce Department figures showed today in Washington. Incomes (PITLCHNG) advanced, rising 0.3 percent last month as wages and salaries climbed the most in three months.
Worker pay over the past 12 months is showing its biggest gains since the end of 2012, raising the odds for improving sales at companies such as Hooker Furniture Corp. The pickup in spending that accounts for almost 70 percent of the economy will help put the expansion on firmer footing as the housing market shows signs of fatigue.