Workers' pay continued losing ground to inflation in May even though Americans' after-tax income shot up at a record rate, a Commerce Department report released yesterday shows.

The government said personal income nationwide increased last month at a seasonally adjusted annual rate of just 0.2 percent -- the feeblest advance in six months.

Despite that puny rise, after-tax pay increased at a 3.4 percent clip, the largest such jump since the Commerce Department began tracking the category in January 1959.

That increase actually represents the climb out of a hole that Americans fell into when they had to pay millions more dollars than usual for taxes in April. The April payments cut after-tax income for that month by 2.7 percent, so three-quarters of May's increase was needed to bring workers back up to the status quo.

Economists ignored the after-tax gyrations and instead concentrated on the more gloomy personal income report.

Pretax income since January has risen at a 2.4 percent annual rate, the report showed. But the consumer price index rose 1.9 percent from January through April, and many economic forecasters say next week's Labor Department report will show inflation jumped 0.5 percent in May.

As a result, those five months of inflation would be enough to wipe out a whole year's expected gains in income.

"There's no question that as we go ahead the consumer is going to be under increasing {financial} pressure," said Robert Dederick, chief economist for Northern Trust Co. of Chicago. "Wages aren't keeping pace with inflation, and they're not likely to keep pace."

"The entire consumer sector is starting to weaken and is really no longer the driving force behind expansion," said Norman Robertson, chief economist of Mellon Bank in Pittsburgh. "All the signs point to a fairly significant slowdown in the growth of consumer spending."

Economic analyst Deborah Johnson of Prudential-Bache Securities Inc. in New York echoed Robertson's view that consumer spending was a driving force in the economy last year but has flagged this year.

The government reported yesterday that consumer spending rose at a mere 0.1 percent annual rate in May.