A sense of financial stability was more pervasive among American consumers in 2016 than in any year since the global recession. According to our most recent Consumer Sentiment Survey—part of a series on consumer trends we’ve conducted since 2008—more US consumers felt they were on solid financial footing in September 2016 than at any time in the past eight years. (A separate survey found continued growth in consumer confidence through December, then a slight dip in January. )
Although slightly more than one-third of survey respondents still expressed concern about job loss, other indicators shifted decisively in a positive direction (Exhibit 1). Only 24 percent of those surveyed—compared with 51 percent in 2009—said they are living paycheck to paycheck. Only 19 percent, down from 48 percent in 2009, said they are finding it harder to make ends meet.
This sense of greater financial security is reflected in consumers’ purchasing decisions. The percentage of respondents who said they are cutting back on spending dropped to 27 percent, from a high of 59 percent in 2009. Whereas in 2010, 70 percent of US consumers said they are “increasingly looking for ways to save money,” that number has fallen to 42 percent (Exhibit 2). Only about one-third of US consumers—down from 63 percent in 2010—said they are “paying more attention to prices.” Fewer respondents said they are looking for sales and promotions, increasing their use of coupons and loyalty cards, or taking other money-saving actions.
At the same time, more US consumers are choosing to shop around for better deals on their favorite brands. The percentage of respondents who said they are buying their preferred brands at stores with lower prices rose eight percentage points since 2015, to 37 percent (Exhibit 3).
The latest survey results confirm several trends that have been playing out over the past year or so. For example, more US consumers claim to be choosing more healthful foods; they’re also continuing to shift some of their spending to the online, club, and discount channels. For consumer companies, the imperatives we laid out in our June 2016 article remain as relevant as ever.