Americans' disposable personal income rose a strong 6.8% in 1984, after subtracting taxes and inflation, the government said today. The gain was almost double that of 1983 and the best in more than a decade.
The Commerce Department said the improvement in disposable income--what's left after paying taxes--resulted from a strong increase in employment during the year. In 1984, the labor force grew by 2.2 million, the largest December-to-December increase in five years.
The 6.8% gain contrasted with a 3.5% increase in 1983 and a minuscule 0.5% increase in 1982, when the country was mired in recession.
It was the strongest one-year increase since a matching 6.8% gain in 1973.
For the month of December, the department reported that personal income rose 0.5% after a 0.6% increase in November.
Personal consumption spending, which includes virtually everything except interest payments on debts, rose an even stronger 1.2% in December, following a 1% rate the month before. The two strong increases in spending followed a 0.4% decline in October.