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Wealthiest consumers still unwilling to spend

Summary

Americans are still hesitant to spend. Even consumers earning some of the highest incomes are unwilling to reopen their wallets.

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Americans of all ages are still keeping their wallets tightly clamped despite economists’ predictions of revival, according to a joint poll by AdweekMedia, a conglomerate of publications and websites, and Harris Interactive, a market research group.

During the past year, 79 percent of consumers lowered their budgets due to the floundering economy. Over the course of the year, only 4 percent have resumed spending as normal. Even those earning over $75,000 annually haven’t returned to old habits, with only 6 percent spending as much as before. Young adults, aged 18 to 34, have increased their expenditures more than any other demographic, though the majority are not spending as much as they did last year.

Of those who cut spending, 76 percent have not increased expenditures in any way. Adults from ages 35 to 44 were most loyal to their budgets, with 84 percent still holding tight. “While most economists are starting to say the economy is turning around or that the recession is coming to a close, consumers may not be of the same mind,” concluded the Harris Interactive poll.

What might overcome the reluctance to spend? The poll determined that appeals to patriotism were most likely to do the trick.

Other information highlighted in the report:

  • Only 24 percent of Americans who cut spending have increased spending.
  • Twenty-four percent of adults ages 18 to 34 did not make any cuts at all.
  • Seventy percent of those with the midlevel incomes, ranging from above $35,000 to less than $75,000, said they “made a lot of cuts” to their budgets during the past year.

See related:Consumer credit plunges record $21.5 billion in July, Consumers’ economic confidence grows, but nervousness lingers, Consumers hold back on discretionary spending

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