"But the variable that has arguably received the most attention has been consumer spending, specifically how it diverges depending on the demographics in question. The Federal Reserve Bank of New York recently looked at this question through the lens of educational attainment, and the results suggest that, while many young Americans contemplate professional lives that do not require a bachelor's, the ability to keep pace with the economy is still at least somewhat predicated on one's level of education."
"In a dataset released Tuesday, the New York Fed analyzed monthly consumer spend data for 200,000 Americans between January 2023 and December 2025. Adjusted for inflation, retail spending among Americans without a college degree rose by around 4% during that period. But it rose by nearly 6% for consumers with a college degree. Each month over the past three years, degree-holders averaged a 0.14% increase in spending relative to the previous month, while non-degree counterparts managed only 0.05%."
The economy shows a K-shaped divergence where wealthier households benefit from rising stock prices and home values while lower-income households face inflation and weaker hiring. Consumer spending differs by education: the New York Fed analyzed monthly spending for 200,000 Americans from January 2023 to December 2025 and found inflation-adjusted retail spending rose about 4% for those without a college degree and nearly 6% for college graduates. Degree-holders averaged a 0.14% monthly spending increase versus 0.05% for nongraduates. The spending gap persists despite a relatively more difficult labor market for college graduates in 2025.
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