Income and spending was same-old, same-old last Fall. But savings kept falling

Even with the job losses and other disruptions from the Fall’s government shutdown, apparently there wasn’t much change for the consumer spending side of the economy vs what we had in the Summer.

Consumers continued to ramp up their spending as the holiday shopping season revved up in November, but high prices continued to bite, new data showed Thursday.

A shutdown-delayed report from the Commerce Department showed that spending rose 0.5% from October, an increase that was above economists’ expectations for a 0.4% gain.

When adjusted for inflation, consumer spending rose 0.3%.

The report also showed that inflation remained stubbornly higher than normal, according to the shutdown-delayed report that also included previously unreleased data for October.

But that consumer spending number isn’t adjusted for inflation, so real spending went up by 0.3% in each of those months – still solid, but not booming either.

But inflation is still running at a 12-month increase of 2.8% in this report (if you buy that food prices slightly declined in October and November. Why are you laughing?). That’s not really any different than the PCE index was rising during the election in November 2024, when we were told prices were rising at an unacceptable rate.

Another trend that continued with this report was income growth staying soft, only up by 0.1% in October and 0.3% in November. And for much of 2025, work income has grown at lower amounts than we saw in 2024.

`

Which means that personal savings continued to fall through November of last year, down by nearly $479 billion on an annual basis compared to where we were in April, and dropping the savings rate to 3.5% - the lowest in more than 3 years.

And this is before the jump in health insurance premiums hit in January, along with other year-start gouging re-setting of prices by businesses. Doesn’t seem that great.

But I guess as long as people keep the money moving and mass layoffs keep getting avoided, the economy will keep growing. No matter how weak the fundamentals are or how much closer to the edge normal working people keep getting.