Americans Are Spending, and Not Just on Necessities

When food prices began rising rapidly at the end of last year, American households spent more on groceries.When gas prices spiked this spring, they spent more on fuel.After all, what choice did they have?But with inflation cooling — at least for now — and the moribund labor market showing some newfound life, there are hints that more Americans are taking the opportunity to spend more on what they want, not just what they have to buy.Retail sales data from the Census Bureau on Thursday provided the latest evidence.

U.S.retail and food services sales were up a solid 0.2 percent in June, a slight deceleration from April and May numbers, but it builds upon a steadying trend.

Spending in discretionary categories like furniture stores, electronics retailers and restaurants all rose.For the second quarter as a whole, sales were up 6.4 percent from a year earlier, before adjusting for inflation.For wealthy Americans, spending freed-up cash on hand is nothing new.Buoyed by surging stock portfolios, the rich have been shelling out for first-class plane tickets, fancy meals at restaurants and other luxuries.

The highest-earning top third has helped keep overall consumption robust despite high interest rates, tariffs and other economic headwinds.Many other households, however, have been struggling just to maintain their standard of living amid rising prices and slowing wage growth.Debt levels have soared in recent years, and saving rates have tumbled.

The challenge became even more acute when gas prices jumped this spring, leading inflation to outpace wage growth.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access.If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe....