Warmer weather lifts economy from woes as spending grows

A shopper passed through Herald Square, outside Macy’s on 34th Street in New York, on Thursday.  Consumer spending rose sharply in the month of March.

Andrew Burton/Getty Images

A shopper passed through Herald Square, outside Macy’s on 34th Street in New York, on Thursday. Consumer spending rose sharply in the month of March.

WASHINGTON — The US economy is emerging from hibernation after a bleak winter.

Consumers are ramping up spending, businesses are ordering more goods, and manufacturers are expanding. The strengthening numbers show that harsh snowstorms and frigid cold in January and February were largely to blame for the economy’s scant growth at the start of the year.


Growth appears to be picking up as the weather improves, and economists think the government on Friday will report a solid hiring gain in April exceeding 200,000 jobs.

‘‘Harsh winter weather deferred, delayed, and displaced but did not destroy economic activity,’’ said Diane Swonk at Mesirow Financial.

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Meager growth early this year ‘‘did not reflect underlying demand,’’ she said.

The economy barely expanded in the first quarter, eking out an annual growth rate of just 0.1 percent, compared with a 2.6 percent rate in the final three months of 2013. Americans spent more last quarter on utilities and health care, but their spending on goods barely rose. Businesses also reduced spending, and exports fell.

One drag on the economy appears to be the faltering housing recovery. Home building and renovation declined in the January-March quarter, slowing growth for a second straight quarter.


Builders started work on fewer homes in March than they did a year earlier. Sales and construction could rebound later this year, but economists do not expect housing to contribute much if at all to growth.

Still, other data indicate that the economy was already rebounding in March and probably improved further in April. Auto sales jumped 8.5 percent in April compared with a year ago, the best April sales increase in nine years.

Consumers spent more at furniture stores and retail chains. Consumer spending soared 0.9 percent in March, the government said Thursday, the most in 4½ years.

Economists watch consumer spending closely because it makes up about 70 percent of economic activity.

“Many Americans headed out to the shopping mall and automobile dealerships in March after staying home and cranking up the heat for the first two months of the year,’’ said Chris Christopher, an IHS Global Insight economist.”

Spending is up partly because Americans earned a bit more, and confidence has improved from the bleak winter months. Incomes rose 0.5 percent in March, the government said, the most since August.

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