The only growth in consumer spending in 2010 came from people making more than $100,000, David Calhoun, CEO of Nielsen Co., told an advertising conference this month.
He's right. Spending in "stores, restaurants, gas stations, and online" has grown slowly over the last two years, according to Gallup data, but just about all of the growth has come from the richest 20 percent. Look at this chart comparing spending in May over the last three years (spending figures in dollars per month):
Marketing execs care about this kind of stuff because they can't raise prices unless their clientele is upper income, Jack Neff explains in AdAge. Estee Lauder's consumers spend 20% above the consumer average. Dr. Pepper drinkers spend 1.3% below. Prices are stickiest where wages are stickiest, and wages are stickiest in the middle.
You should care about this because it's the same story that has haunted the middle class for the last 30 years. Real wages have not moved for the typical worker, and income gains have accumulated at the top. In the 2000s, net worth increased for the middle class when housing prices surged, but we all know what's happened there. So where does the spending recovery for the next ten years come from?