Wealthier Americans aren’t spending — or earning—like they used to.
Data from Bank of America Institute out Wednesday reveals households making more than $125,000 have seen wage growth slow down faster than lower-income households while spending trends have followed a similar pattern. Higher-income households’ discretionary spending on Bank of America credit and debit cards has slipped below lower- and middle-income groups since the start of this year.
The data is notable, Bank of America argues, because the highest-earning 40% of households by income accounts for more than 60% of overall consumer spending. Its calculation of wages includes bonuses, which tend to fluctuate more than base pay.
“A labor market slowdown driven by the higher end of the income scale could have an outsized impact on the overall economy,” BofA wrote in a note to clients. “As of now, the labor market is beginning to soften from a very buoyant initial position, so it will likely take quite some time before the full impact on consumer spending comes through.”
While unemployment
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