{"id":16793,"date":"2025-09-15T02:00:19","date_gmt":"2025-09-15T02:00:19","guid":{"rendered":"https:\/\/www.newsbeep.com\/il\/16793\/"},"modified":"2025-09-15T02:00:19","modified_gmt":"2025-09-15T02:00:19","slug":"the-k-shaped-economy-in-one-chart","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/il\/16793\/","title":{"rendered":"The K-shaped economy, in one chart"},"content":{"rendered":"

The idea of a \u201cK-shaped recovery\u201d \u2014 relatively affluent Americans doing well, while those lower on the income spectrum struggle mightily \u2014 was in vogue<\/a> as the US economy emerged from its Covid-induced recession in 2020.<\/p>\n

A few years of better wage growth for lower earners helped put a dent in this trend, but now, the \u201cK-shaped economy\u201d is back in a big way:<\/p>\n

\"BofA<\/a><\/p>\n

Liz Everett Krisberg, head of the Bank of America Institute, and senior economist David Michael Tinsley wrote in a new report (emphasis ours):<\/p>\n

\u201cThe labor market slowdown appears to be impacting lower-income households, in particular. According to Bank of America deposit data, after-tax wage and salary growth slipped to just 0.9% year-over-year (YoY) for lower-income households in August \u2014 the smallest gain since the start of the series in 2016. Wage growth for higher-income households, on the other hand, rose to 3.6% YoY, the highest growth rate since November 2021. This growing divergence between income cohorts is also reflected in spending trends, with credit and debit card spending growth easing for lower-income households but accelerating for higher-income ones.\u201d <\/p>\n

Deteriorating labor market outcomes for lower-income and traditionally marginalized groups sucks. Full stop.<\/p>\n

From a macroeconomic perspective, however, remember that the top 40% of earners drives over 60% of US consumer spending<\/a>. That means any easing of nominal consumption growth at the lower end of the income scale can be more than offset by a similar-sized pickup in spending growth at the upper end.<\/p>\n","protected":false},"excerpt":{"rendered":"The idea of a \u201cK-shaped recovery\u201d \u2014 relatively affluent Americans doing well, while those lower on the income…\n","protected":false},"author":2,"featured_media":16794,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[114,184,85,46],"class_list":["post-16793","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-il","tag-israel"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/16793","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=16793"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/16793\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/16794"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=16793"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=16793"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=16793"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}