Consumer spending rose in August, but only because people were forced to shell out more money for higher gas prices.
Americans spent 0.5 percent more in August than in July, the Commerce Department reported Friday. That seems like a healthy jump, but gas prices shot up nearly 50 cents per gallon in those two months.
Once the department figured in the more expensive gas and other price increases, spending inched up only 0.1 percent.
Income increased only 0.1 percent, but it gets worse: once inflation is taken into account and taxes are deducted, income actually dropped 0.3 percent.
Unemployment is still high; wages are increasing little, if at all, the Associated Press reported. People cannot save money under these conditions and they spend less, which acts as a drag on the economy.
A retail sales report indicated that Americans are cutting back on clothing, electronics and at general merchandise stores.
The housing market is recovering somewhat and hiring gains are expected in September. The word modest has been used to describe both improvements.
Six weeks before the presidential election, the economy is still sputtering.