Affluent Shoppers Drive U.S. Retail Growth Amid Inflation

High-income consumers are propping up retail sales while lower-income Americans pull back on spending.

Updated on Nov. 4, 2026 in Spending

Empty polished concrete retail corridor with nested steel shopping carts at the far end and warm sunlight falling through an open glass door. — U.S. retail sales rose in August as affluent shoppers offset pullbacks by lower-income Americans, even as inflation stays elevated. AI Illustration. Upload story photo >

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U.S. retail sales jumped in August, with higher-income consumers driving the increase even as inflation remains elevated. Lower-income Americans are scaling back spending, according to the extraction's reporting on the divergence.

Why it matters

Wage growth has hit a wall despite elevated inflation, leaving households with different levels of income facing very different spending pressures. The split suggests that aggregate retail figures can mask weakening demand among lower-income consumers.

American Express reported third-quarter revenue of 20.1 billion U.S. dollars, up 9 percent year-on-year, with card spending rising 8 percent to 454 billion dollars. American Airlines reported third-quarter revenue of 16.3 billion dollars, up 19.3 percent from a year earlier, though the extraction does not detail the underlying sales breakdown.

The players

American Express

American Express is a major U.S. payments and credit card company whose quarterly spending data offers a window into affluent consumer behavior.

American Airlines

American Airlines is one of the largest U.S. carriers, and its revenue growth reflects strong demand for air travel.

Dollar General

Dollar General is a discount retailer whose sales results are often read as a signal of lower-income household spending.

Dollar Tree

Dollar Tree is a discount variety retailer that, like Dollar General, serves budget-conscious shoppers.

The details

Lower-income individuals sought bargains on daily necessities at discount stores, and Dollar General and Dollar Tree beat quarterly sales expectations in August. Lower-income households increasingly rely on credit cards to get by, while affluent households use them for travel and entertainment, with American Express travel and entertainment spending up 10 percent and airline spending up 13 percent.

August: U.S. retail sales jumped and Dollar General and Dollar Tree beat expectations.
October: A Conference Board consumer confidence report showed slight improvement as gas prices eased by 25 to 50 cents a gallon.
Third quarter: American Express and American Airlines reported quarterly revenue gains.

Market Dynamics

The divergence between high-income spending and lower-income retrenchment is playing out against the backdrop of the Conference Board consumer confidence report, which showed only slight improvement in October. Experts said the trend is likely to affect the midterm elections.

Households with lower incomes may need to lean on discount stores and credit cards for daily necessities as wage growth lags inflation. Higher-income households may continue to fuel travel and dining spending even as broader financial pressures persist.

The takeaway

Tracking your own spending across categories can reveal whether inflation is squeezing essentials more than discretionary purchases. Reviewing credit card balances against monthly income is a practical step when wage growth is not keeping pace.