Consumer spending drops $20B in October
Experts say the unexpected drop in consumer spending and income during the month of October is due to lost wages and disruptions from Hurricane Sandy.
Consumer spending decreased $20.2 billion, or 0.2 percent, and real disposable income decreased 0.1 percent in October compared to the previous month, according to a Bureau of Economic Analysis report.
“The October estimates of personal income and outlays reflect the effects of Hurricane Sandy, which made landfall in the United States on October 29,” the report said. “The storm affected 24 states, with particularly severe damage in New York and New Jersey.”
October wages decreased $17.1 billion nationally, following a $22.4 billion increase in September.