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The economy can count on the American consumer.

That was true in the pandemic years and the high-inflation era that followed, just as it is in the first months of the new tariff regime. But the question of who is doing all that spending has taken on greater importance, especially as talk of an economic slowdown has grown.

The most affluent consumers account for a bigger share of total US spending, reinforcing the lopsided dynamic of unbothered consumption for the wealthy and more cautious shopping for everyone else.

Americans in the bottom 80% of the income distribution, those making less than $175,000 a year, are barely keeping their spending on pace with inflation, according to an analysis by Mark Zandi, chief economist for Moody’s Analytics. Meanwhile, the top 20% of consumers are growing their spending.

"The data also show that the US economy is being largely powered by the well-to-do," Zandi said.

It's a similar bifurcation to the labor market. As Fed Chair Jerome Powell noted in January, "If you have a job, it's all good. But if you have to find a job, hiring rates have come down." (It's gotten even worse since then.)

Read more: How the Fed rate decision affects your bank accounts, loans, credit cards, and investments

Consumers in the top 10% of the income distribution accounted for 49.2% of total spending in the second quarter, registering the highest level recorded since 1989.

The sharpening contrast comes as other economic metrics show a rough going for summer's end. Unemployment is on the rise as hiring has slowed. Inflation remains stubbornly high, and consumer sentiment has flagged.

"As long as they keep spending, the economy should avoid recession, but if they turn more cautious, for whatever reason, the economy has a big problem," Zandi said.

Still, economists pointed to specific categories to underscore softness, even as retail sales topped expectations.

“Tariff pressures are becoming increasingly visible, with several retail categories registering volume declines as some households struggle to absorb higher prices," said EY-Parthenon chief economist Gregory Daco in a note on Tuesday.

Bill Adams, chief economist for Comerica Bank, said that weakness in grocery store sales is likely another sign that lower- and middle-income consumers are retrenching.

The disparity in spending is just one piece of an economic data puzzle that resists neat storylines and features jumbled messages.

On Tuesday, this newsletter highlighted the "jobless expansion," another story this year that involves conflicting signals: rising unemployment alongside record-breaking stock prices.

Now, spending data has flashed the resilience that powered the economy through some dark moments. But that strength is skewed, and it may not last.

Hamza Shaban is a reporter for Yahoo Finance covering markets and the economy. Follow Hamza on X @hshaban.

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