(WSJ) The U.S. Economy Depends More Than Ever on the Top Two Quintiles of the Economy

Many Americans are pinching pennies, exhausted by high prices and stubborn inflation. The well-off are spending with abandon. 

The top 10% of earners—households making about $250,000 a year or more—are splurging on everything from vacations to designer handbags, buoyed by big gains in stocks, real estate and other assets.

Those consumers now account for 49.7% of all spending, a record in data going back to 1989, according to an analysis by Moody’s Analytics. Three decades ago, they accounted for about 36%.

All this means that economic growth is unusually reliant on rich Americans continuing to shell out. Mark Zandi, chief economist at Moody’s Analytics, estimated that spending by the top 10% alone accounted for almost one-third of gross domestic product. 

Between September 2023 and September 2024, the high earners increased their spending by 12%. Spending by working-class and middle-class households, meanwhile, dropped over the same period. 

Read it all.

Households making $250,000+ now account for 49.7% of all U.S. spending.

"Three decades ago, they accounted for about 36%. All this means that economic growth is unusually reliant on rich Americans continuing to shell out."

This chart that accompanies @WSJ's story is striking: https://t.co/uT4cc3Qv05 pic.twitter.com/7gxYPjX4aG

— Marty Swant (@martyswant) February 24, 2025