"A Moody's analysis shows U.S. spending growth since the pandemic has come almost entirely from the wealthiest households, with the bottom 80% merely keeping pace with inflation. Chief economist Mark Zandi warned that the economy is increasingly "tethered" to the top earners, whose wealth continues to surge, while retail sales remain resilient despite weaker job growth and higher prices. If you feel like the economy isn't working for you, that's because it probably isn't."
""Looking at the data, it's not a mystery why most Americans feel like the economy isn't working for them," Zandi wrote. "For those in the bottom 80% of the income distribution, those making less than approximately $175,000 a year, their spending has simply kept pace with inflation since the pandemic." "The 20% of households that make more have done much better, and those in the top 3.3% of the distribution have done much, much, much better.""
Since the pandemic, aggregate spending growth has been concentrated among the highest-income households while the bottom 80% of earners have largely matched inflation. The divergence between very high earners and low- and middle-income households has widened, particularly since late 2022. The top 3.3% and top 96.6–100% earners show substantially larger spending increases compared with low- and middle-income groups. Using a Q4 1999 base of 100, top earners have raised spending to roughly 170 basis points versus about 120 for lower cohorts. Retail sales remain resilient despite weaker job growth and higher prices, tethering the economy to upper-income consumption.
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