US Consumers Keep Spending as Unemployment Stays Below 5% for Nearly 5 Years
Updated
Updated · A Wealth of Common Sense · Aug 4
US Consumers Keep Spending as Unemployment Stays Below 5% for Nearly 5 Years
3 articles · Updated · A Wealth of Common Sense · Aug 4
Summary
US households are still spending heavily on travel, dining, movies and other discretionary purchases despite persistent complaints about inflation and the broader economy.
Sub-5% unemployment for nearly five years — and roughly 8-9 years excluding the Covid spike — has kept paychecks flowing, while prime-age labor-force participation sits above 2010s levels and near late-1990s highs.
Stock-market gains are also supporting higher-end demand, with affluent buyers splurging on luxuries such as boat engines that cost $20,000 to more than $70,000 per motor.
Record activity across services underscores that resilience: late July brought the busiest day ever for US commercial air traffic, and last weekend delivered the biggest movie box-office haul on record.
The outlook hinges on jobs staying plentiful; the report argues spending should hold up while growth continues, but a meaningful rise in unemployment could trigger a sharp pullback.