Personal income ended the year on a positive note-increasing 0.5 percent in December, its largest gain since February 2011.
Over the past 2 years, personal income has increased in all but one month. The large spike in January of 2011 was largely due to the payroll tax cut. The payroll tax cut was temporarily extended through the end of February, but if Congress doesn’t act to extend it for the full year we could see personal income take a significant blow. The growth in personal income in December is in line with a raft of other recent economic indicators that showed the U.S. economy picking up steam at the end of 2011.
~Mark Doms, Chief Economist, U.S. Department of Commerce
February 1, 2012
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