Americans Are Spending More and Feeling Poorer for It

The macro backdrop looks strong on paper, and thin inside the household. The U.S. Census Bureau reported May 2026 retail and food services sales of USD 763.7 billion, up 6.9% from a year earlier (U.S. Census Bureau, 2026). This survey measures how that growth feels to the people doing the spending, and the answer is that the extra dollars are not translating into a sense of getting more.

The single number that frames the year is 58%: a clear majority of shoppers say they are spending more and getting less for it. That gap between what the headline sales figure says and what households feel is the story of the report, and it widens sharply once the data is split by income.

Nearly four in five American shoppers are in some form of defensive crouch, even as the official sales figures climb. The sections below test where that pressure lands hardest.

Dining out is the first category to go. Forty-four percent of respondents say dining out is the category they have cut most in the past six months, ahead of apparel at 33%, home decor at 24%, travel at 21% and electronics at 18%. Fourteen percent cut none of these.

The order is telling. The two categories cut most, restaurant meals and clothing, are the ones households can defer without changing their standard of living on paper. The discretionary treat goes first, the wardrobe refresh second, and the bigger-ticket categories like electronics hold on longest because they are replaced on need rather than whim.

When American households trim, the restaurant meal is the first thing off the table.

Half are budget-watching, and a further quarter are cutting deep. Fifty percent describe their approach as cautious and budget-watching, and 28% say they are cutting back significantly, a combined 78% in some form of restraint. Only 13% report spending freely, and 9% see no particular pattern.

The sentiment sits uneasily beside the macro numbers. Retail sales are up nearly 7% year over year, yet more than three-quarters of the people generating those sales describe themselves as pulling back. When spending rises while confidence falls, the extra dollars are usually going to necessities that cost more, not to consumers choosing to buy more.

Spending is rising and confidence is falling, which is the signature of a household paying more to stand still.

A mix of online and in-store leads. Forty-one percent shop clearance through a mix of online and in-store, 33% in-store only and 26% online only. Two-thirds of clearance shoppers now include a screen somewhere in the process.

The channel tilt matches the official data. In the Census Bureau's May 2026 report, nonstore retailers grew 12.2% year over year against 7.5% for total retail trade (U.S. Census Bureau, 2026). Online is not just growing faster in the aggregate, it is where the deal-seeking behavior is concentrating.

Online is no longer the alternative channel for a deal, it is the default half of one.

Caution rises steadily as income falls. Combined cautious or significantly reduced spending reaches 86% among households earning under USD 50,000, 81% in the USD 50,000 to 99,900 band and 72% in the USD 100,000 to 149,900 band, then falls to 61% among those earning USD 150,000 or more. The gap between the lowest and highest income tiers is 25 points.

This is where the headline growth figure comes apart. A 6.9% rise in aggregate sales can coexist with 86% of low-income households pulling back, because the dollars are not distributed evenly. The macro number describes an average that almost no lower-income household is living.

There is one retail economy on paper and two in practice, split cleanly by income.

It has climbed every year. The share of shoppers saying they feel they are spending more without getting more value rose from 39% in 2022 to 47% in 2023, 53% in 2024 and 58% in 2025, the reading carried into this year's fielding. The sentiment did not spike and fade with a single inflation shock; it settled in and kept rising.

The trajectory matters more than any single reading. A one-year jump could be noise, but four consecutive annual increases describe a durable shift in how households experience their own spending. Even as headline inflation cooled from its peak, the felt gap between outlay and value kept widening.

The value gap is not a spike, it is a trend, and it has widened for four years running.

Online-inclusive clearance shopping skews young. It reaches 81% among 18-to-24-year-olds and declines with every age band, to 76% at 25 to 34, 69% at 35 to 44, 63% at 45 to 54, 57% at 55 to 64 and 48% among those 65 and over. The 33-point spread from youngest to oldest is the clearest generational line in the study.

The gradient is smooth, not stepped, which means this is a slow generational replacement rather than a sharp break. As younger cohorts age into higher-spending years, the online-inclusive share of clearance shopping will rise with them, and the in-store-only shopper will keep shrinking as a share of the market.

The clearance aisle of the future is a screen, and its customers are already here.

The wealthiest are nearly three times likelier to plan an increase. Thirty-nine percent of households earning USD 150,000 or more plan to spend more at year-end sales, against 28% in the USD 100,000 to 149,900 band, 20% in the USD 50,000 to 99,900 band and 14% of those under USD 50,000.

That skew is the forward story for retailers. The National Retail Federation forecasts total 2026 retail sales to grow 4.4% to USD 5.6 trillion (National Retail Federation, 2026). This survey suggests that momentum is riding disproportionately on higher-income households, the exact group that needs a clearance discount least.

The year-end retail surge is being underwritten by the households that need the discounts least.

The number that captures the year is 58%: most Americans feel they are spending more and getting less for it, and the feeling has risen four years straight. Growth is real in dollars and thin in value, and the households with the least cushion are the ones cutting the deepest. The retailers reading this report will see two customers where the headline sees one, and the gap between them is the fiscal story of 2026.