Wall Street Journal analysis of middle class income and spending show how the Great Recession has changed buying patterns. What are the takeaways?
- Income has been flat from 2007-2013 at about $49,000 per household while inflation has grown over 12% which means families are losing ground.
- Consumers spending more on necessities, less on wants: Home internet, cell phones and health insurance saw largest increases while residential phone, household textiles and women’s apparel saw largest decreases.
- From the article: ““Part of the story is that your income growth is slowing,” said Steven Fazzari, an economist and chairman of the sociology department at Washington University in St. Louis. “They’re spending more on necessities, cutting back on other types.”
- For those categories that showed largest increases, have students brainstorm on how they might be able to control costs. For example, with their cell phone data plans they could review their activity to be sure that they aren’t using less data then they are paying for.