While almost half of all Americans say they are spending more this year over last, it’s not necessarily good news for the economy, according to a new Gallup poll on consumer spending.
The largest segment of the population, the Baby Boomer generation, is reporting increased spending on necessities, but an unwillingness to purchase discretionary items.
Gallup’s poll on consumer spending trends was conducted via telephone June 9-15, 2014. A random sample of 1,029 adults, ages 18 and over, from all states and Washington, D.C., was selected to participate. Samples included representatives of four generations: Millennials, Generation X, Baby Boomers and Traditionalists.
Forty-five percent of Americans reported they were spending more now than a year ago compared to 18% who reported spending less. The percentage of those saying they were spending more was fairly stable across all demographic categories.
Who is Spending More?
Comparing the generations, the Gallup poll revealed that a significant number of people in all generations report higher spending this year versus last:
- Millennials – 51% said they were spending more while 15% reported less
- Generation X – 42% said they were spending more with 21% spending less
- Baby Boomers – 44% were spending more with 20% spending less
- Traditionalists – 44% spending more with 12% spending less
Willingness to Spend Remains Low
While spending is up, people are not necessarily happy about it. Pollsters asked respondents about their willingness to spend money with these results:
- Millennials – 14% more willing to spend, 41% less willing
- Generation X – 8% more willing, 56% less willing
- Baby Boomers – 11% more willing, 54% less willing
- Traditionalists – 8% more willing, 45% less willing
While a majority of Baby Boomers reported they are less willing to spend, they report spending a significant amount more this year versus last. Those expenses, researchers found, are related to necessities such as utilities, home maintenance, household goods and healthcare.
Sluggish Discretionary Spending
The poll also revealed that Millennials were the most likely group to spend on discretionary items. Here’s a look at how the generations came in on leisure and clothing-related spending:
Leisure Activities
- Millennials – 29% spending more, 37% spending less
- Generation X – 23% spending more, 33% spending less
- Baby Boomers – 21% spending more, 25% spending less
- Traditionalists – 28% spending more, 32% spending less
Clothing
- Millennials – 31% spending more, 27% spending less
- Generation X – 28% spending more, 31% spending less
- Baby Boomers – 21% spending more, 31% spending less
- Traditionalists – 16% spending more, 31% spending less
While overall spending is up, Gallup’s researchers say the trend isn’t likely to help with immediate economic improvements due to its non-discretionary nature. Increased discretionary spending reported by Millennials, however, is a good sign since that segment of the population is also large.
“These younger consumers are beginning to do their part to help the economy improve,” the poll’s authors conclude.
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