Analysislabor economyconsumer spendinghousehold financeeconomic sentiment
Labor Economy Signals Broader Consumer Spending Strain
6.0
PYMNTS Intelligence reports that roughly 60 million U.S. 'Labor Economy' workers—earning under $25/hour—are showing strained holiday spending in a Dec. 10 supplement to its Wage to Wallet® Index. Nearly half say they lack confidence to buy gifts without going into debt, 6 in 10 rely on cash/debit, and 1 in 5 expect holiday debt to last over six months. This pullback could reduce consumer spending and pressure broader economic activity.
Key Points
- 1Report finds nearly half of 60 million Labor Economy workers can't afford gifts without debt
- 2Labor Economy contributes 15% of consumer spending, so reduced spending can dent overall economy
- 3Managers and policymakers should target liquidity and timing interventions to stabilize low-wage consumer cash flow
Scoring Rationale
Relevant new PYMNTS spending data highlight wide-reaching consumer risk, limited by single-source survey sample limitations.
Sources
Public references used for this report.
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