>The more people thought the prices they paid rose faster than their incomes, the worse they said they were doing.
>Consumers were more likely to overestimate than to underestimate the inflation they experienced. Those consumers who overestimated their verified inflation said they felt worse about economic conditions.
>Most respondents reported higher household incomes in 2024 versus 2019 but still said they did not feel good about the economy due to the effort they exerted to adapt to the economic environment.
>After adjusting for inflation, verified spending on everyday retail items remained strong even among those who reported having lower incomes or among those who said they felt worse about the economy in 2024 compared with 2019.
>Taken together, we show that what consumers have been saying differs from what they have been doing during the post-pandemic period; consumers say they feel worse, but through the end of 2024, they are buying more – not just spending more – than they did in 2019. This disconnect between what consumers have been saying and doing suggests that consumer sentiment surveys on their own have become weaker indicators of future consumer behavior and of the health of US consumers. While it is important to recognize how consumers feel, we should exercise caution when using consumer sentiment surveys to infer future consumer behavior given this recent disconnect between what consumers say and do.
hibikir_40k on
One possible, deeper interpretation of this is that companies have gotten much better at making people choose a more expensive option, and that can lead to both higher spending and more unhappy customers, without inflation, as measured by the fed, ever going up. More high end items, more segmentation, more mechanisms to extract whatn can be extracted.
An example of this is the advancements on airplane price segregation over the years. Some companies include more seating classes, and chharge for specific seating within each class. Extra fees from beginning to end, charging for the ability to move your tickets… all in all it creates an environment that attempts to maximize airline profit, and doesn’t even necessarily raise total prices paid when you compare across the entire industry… but either way the process of buying a ticket just feels awful. And airplane tickets is just one random example: We see the modern concert, or the many items that end up with scalpers, or the ever more complicated subscriptions to streaming services. Even at the supermarket, we see more prices that are higher than what we want to pay, and often than what we actually pay. Waiting for a sale feels bad.
The natural result of this model is that everyone now sees things priced higher than they are willing to spend. When added to actual inflation, it’s logical that so many people are unhappy, even if their salaries are actually going up. The process of buying is enshittified in itself, but unhappy people are still paying more.
2 Comments
>Our results indicate that:
>The more people thought the prices they paid rose faster than their incomes, the worse they said they were doing.
>Consumers were more likely to overestimate than to underestimate the inflation they experienced. Those consumers who overestimated their verified inflation said they felt worse about economic conditions.
>Most respondents reported higher household incomes in 2024 versus 2019 but still said they did not feel good about the economy due to the effort they exerted to adapt to the economic environment.
>After adjusting for inflation, verified spending on everyday retail items remained strong even among those who reported having lower incomes or among those who said they felt worse about the economy in 2024 compared with 2019.
>Taken together, we show that what consumers have been saying differs from what they have been doing during the post-pandemic period; consumers say they feel worse, but through the end of 2024, they are buying more – not just spending more – than they did in 2019. This disconnect between what consumers have been saying and doing suggests that consumer sentiment surveys on their own have become weaker indicators of future consumer behavior and of the health of US consumers. While it is important to recognize how consumers feel, we should exercise caution when using consumer sentiment surveys to infer future consumer behavior given this recent disconnect between what consumers say and do.
One possible, deeper interpretation of this is that companies have gotten much better at making people choose a more expensive option, and that can lead to both higher spending and more unhappy customers, without inflation, as measured by the fed, ever going up. More high end items, more segmentation, more mechanisms to extract whatn can be extracted.
An example of this is the advancements on airplane price segregation over the years. Some companies include more seating classes, and chharge for specific seating within each class. Extra fees from beginning to end, charging for the ability to move your tickets… all in all it creates an environment that attempts to maximize airline profit, and doesn’t even necessarily raise total prices paid when you compare across the entire industry… but either way the process of buying a ticket just feels awful. And airplane tickets is just one random example: We see the modern concert, or the many items that end up with scalpers, or the ever more complicated subscriptions to streaming services. Even at the supermarket, we see more prices that are higher than what we want to pay, and often than what we actually pay. Waiting for a sale feels bad.
The natural result of this model is that everyone now sees things priced higher than they are willing to spend. When added to actual inflation, it’s logical that so many people are unhappy, even if their salaries are actually going up. The process of buying is enshittified in itself, but unhappy people are still paying more.