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According to data from the National Retail Federation (NRF), more than half of Americans draw on their savings, borrow money, or go into debt just to meet their expenses.
Consumers are facing rising costs in all categories, from essentials to groceries and gas, “as we continue to face the highest rate of inflation in decades,” according to the country’s largest retail group.
In a recent survey conducted by NRF, 47% of consumers said they have switched to cheaper alternatives when shopping for household items as they try to navigate the difficult economic environment.
INFLATION REACHES A NEW 40-YEAR HIGH IN MAY, CONSUMER PRICES UP 8.6%
Almost half of those surveyed, 45% of consumers, are more likely to look for coupons or promotions on these items.
41% of consumers now shop at discounters to find these everyday essentials.
Shoppers at a grocery store in San Francisco, California, U.S., on Monday, May 2, 2022. (David Paul Morris/Bloomberg via Getty Images/Getty Images)
The data also showed that 40% of consumers said they were making savings in other areas to afford these necessities.
Despite these cuts, the survey found that 58% of consumers are still in debt, borrowing money or using their savings to cover their expenses. According to the data, about 72% of consumers in the lowest income bracket, making less than $25,000 a year, are in the same boat.
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Only 40% of consumers say they earn enough to pay for their spending as inflation continues to outpace wage growth. Meanwhile, just 24% of consumers in the lowest income bracket say they can afford the expense.
A customer pumps gasoline into his car at a gas station on May 18, 2022 in Petaluma, California. (Justin Sullivan/Getty Images/Getty Images)
“It’s not sustainable,” NRF CEO Matthew Shay said in a statement. Shay said removing China’s tariffs is “the quickest way to alleviate some of the inflationary pressures in the US economy.”
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According to Shay, these tariffs have pushed up prices for American consumers, costing the average family over $1,200 a year.