Reports, indexes, and subject matter experts have differing perspectives and predictions about the economy, but one thing is certain and that’s uncertainty itself.
Whether or not inflation rates rise even more and how that would impact various markets, the Consumer Price Index shows the greatest year-over-year increase in costs of consumer goods since August 2018. And more than half of consumers have noticed. Twenty-seven percent of U.S. adults reported to CivicScience that their household spending decreased because prices have been higher. Another 38% said they are buying as much as they need to, but that it costs more because prices are higher.
While 32% said they haven’t noticed any changes in their household spending, 87% of the Gen Pop has expressed some level of concern about rising costs overall.
The greatest impact of rising costs is (and likely will continue to be) reported by Americans making $50K or less per year. Currently, those making under $50K report the highest incidence of buying less because prices are higher, but even those earning $150K or more per year are reporting the same (20%).
One prediction of a post-pandemic economy is increased spending due to months spent homebound and, possibly, saving money. If consumers increasingly feel the impact of higher prices for basic needs, that is going to adjust monthly budgets. And if more money is being allocated to necessities, that means less money for spending on wants like vacations, new clothes, and a host of other products across industries.
Stay tuned for more data representing how consumers feel about the economy and how they are choosing to spend their money.