Businesses to Slow Expansion

WASHINGTON — American businesses are planning to boost spending on expansion and modernization in 1985 by just about one-third of the increase of 1984, the government said today.

The Commerce Department said the gain this year will be 5.8% compared with a 15.3% increase in 1984, the biggest surge in 20 years and a key force powering the economic recovery. Capital spending had been expected to cool off somewhat this year, but the slowdown has been even sharper than anticipated as businesses scaled back expansion plans in the face of sluggish overall economic growth.