Spending confidence among Millennials continued to slide in January in stark contrast to surging post-election confidence among Boomers.
As a result, consumer spending in 2017 is likely to be still more uneven among consumable and discretionary categories than last year—even as net growth likely strengthens in the short term.
The steady influence on spending is likely to come from Gen X consumers. Their spending confidence edged higher in January—along with overall confidence—as they remain the core driver of spending confidence since the recession.
These insights are from analysis of the Spending Confidence Index™, which was created by MacroSavvy™ based on data from Prosper Insights and Analytics™.
In terms of the January data from the Index:
- Millennials. Their continued decline in spending confidence was most severe in the clothing category followed by the health and beauty category. Confidence to spend held up best in electronics.
- Gen X. Confidence to spend rose modestly in the electronics, leisure goods, and grocery categories. Spending confidence declined in the clothing, and health and beauty categories.
- Boomers. Spending confidence increased across all categories, but was most pronounced in homegoods. The pickup also was slightly skewed toward lower-income or working class households.
- By Category. The net impact across generations showed an increase in spending confidence among all categories except clothing. Confidence to spend is strongest in homegoods and electronics and weakest in clothing, and health and beauty.
See the scorecard for a summary of the spending confidence measures.
For more background about the Spending Confidence Index™ and its components, the white paper at this link explains why the new index is an improvement over existing measures of confidence.
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