High-income Americans with college degrees increased their spending more quickly in the past three years than lower-income households and those without college degrees, according to new data released Tuesday, evidence of worsening incomes.
Washington — High-income Americans with college degrees have increased their spending more quickly in the past three years than other consumers, according to a new report. New data released on TuesdayThis is evidence of worsening inequality, which may explain some of this increase croak About the economy.
Data from the Federal Reserve Bank of New York show that in the last three months of last year, low-income and rural households faced higher inflation than higher-income households. The spending data focuses only on goods excluding cars, and does not reflect the potential spending of high-income households on travel, restaurants and entertainment.
The numbers add support to the idea of ​​A K-shaped economyHigh-income Americans fuel a disproportionate share of the consumption that is the main driver of the economy, while lower-income families see smaller gains. Poorer households overall often face higher inflation, with a greater share of their spending going to goods that have seen prices rise since the pandemic, such as housing, groceries and utilities.
New York Fed data shows that households with incomes of $125,000 or higher have boosted their spending by 2.3%, adjusted for inflation, since 2023, while middle-income households — between $40,000 and $125,000 — have increased their spending by 1.6%. The report showed that those with incomes of less than $40,000 increased their spending by only 0.9%.
These numbers are in addition to the Federal Reserve Bank of New York Indicators of economic heterogeneitya series of data sets intended to track changes in the economy by geographic region, demographic groups, and income groups.