Wall Street Journal (03/02/12) Ben Casselman; Jon Hilsenrath
A host of reports Thursday indicate that the U.S. economy is finally showing signs of moving onto firmer ground. However the economy is far from robust. Consumer spending has been mixed, and the manufacturing sector, though on the rebound, is not booming, according to a survey of manufacturing purchasing managers by the Institute for Supply Management.
One big worry at the U.S. Federal Reserve is that household incomes have not been growing fast enough to support much additional spending. The U.S. Commerce Department said on March 1 that wage and salary income in January was 5% higher than a year earlier, the fourth straight month of gains of 5% or higher, which hasn’t happened since late 2007. But after adjusting for inflation, income and spending have seen only modest gains in recent months.
The latest signs of growth are met with caution by those who recall that in 2010 and 2011, the recovery seemed to start the year with momentum but petered out by summer. Still, many business executives say they are prepared to move ahead with hiring and investment growth plans despite their lingering uncertainties about the outlook.