Office of Publications & Special Studies

Focus on Prices and Spending, Consumer Expenditure, Volume 2, Number 12

Focus on Prices and Spending | Consumer Expenditure | Volume 2, Number 12

Consumer Spending in 2010

On the basis of data from the Consumer Expenditure Survey (CE), consumers spent less in 2010, compared with 2009, on almost all major components of the household budget. Average annual expenditures per consumer unit (CU)[1] fell 2.0 percent, and average annual income before taxes dropped 0.6 percent, the second consecutive yearly decline for both of these measures. (See table 1.)

Overview of Spending

Although the latest US economic recession officially ended in June 2009,[2] lasting effects were felt throughout the economy in 2010. The drop in spending can be attributed to many factors, including faltering consumer confidence, high unemployment rates, and a depressed housing market. According to the Nielsen Company, consumer confidence in the United States sagged throughout 2010. The Nielsen Consumer Confidence Index, which is reported quarterly, indexed U.S. consumer confidence at 81 for the final two quarters of 2010, the lowest confidence level for U.S. consumers during the year. (Levels above an index of 100 indicate degrees of optimism.)[3] The monthly national unemployment rate, as measured by the Current Population Survey (CPS), never fell below 9.4 percent in 2010. This was the first calendar year since the CPS started collecting employment data in 1948[4] that the monthly unemployment rate was above 9.0 percent every month. Sales of new and existing homes fell for the fourth consecutive year.[5] Foreclosure filings, which include default notices, scheduled auctions, and bank repossessions, were levied on a record 2.9 million U.S. properties.[6]

Table 1. Average annual expenditures and income of all consumer units and percent changes, 2008–2010
Item 2008 2009 2010 Percent change
2008–2009 2009–2010

Income before taxes

$63,563 $62,857 $62,481 -1.1 -0.6

Average annual expenditures

50,486 49,067 48,109 -2.8 -2.0

Food

6,443 6,372 6,129 -1.1 -3.8

At home

3,744 3,753 3,624 0.2 -3.4

Away from home

2,698 2,619 2,505 -2.9 -4.4

Housing

17,109 16,895 16,557 -1.3 -2.0

Apparel and services

1,801 1,725 1,700 -4.2 -1.4

Transportation

8,604 7,658 7,677 -11.0 0.2

Healthcare

2,976 3,126 3,157 5.0 1.0

Entertainment

2,835 2,693 2,504 -5.0 -7.0

Cash contributions

1,737 1,723 1,633 -0.8 -5.2

Personal insurance and pensions

5,605 5,471 5,373 -2.4 -1.8

All other expenditures

3,376 3,404 3,379 0.8 -0.7
Source: Bureau of Labor Statistics, Consumer Expenditure Survey

Spending highlights

CE data have reflected several medium- to long-term spending trends in the U.S. economy:

Chart 1. Average annual expenditures on cell phone and residential phone services, 2001-2010
[Chart data]

Other interesting spending patterns can be analyzed by breaking the 2010 data down by socioeconomic characteristics:

Chart 2. Shares of average annual expenditures spent on major components for selected ages, 2010
[Chart data]

For more information on the availability of current or earlier CE tabular data or microdata, contact the Division of Consumer Expenditure Survey, Bureau of Labor Statistics, 2 Massachusetts Avenue, NE., Room 3985, Washington, DC 20212-0001. Telephone: (202) 691-6000. Email: cexinfo@bls.gov. Online: http://www.bls.gov/cex/.

Notes

[1] Consumer units include families, single persons living alone or sharing a household with others but who are financially independent, or two or more persons living together who share expenses.

[2] For more information on U.S. business cycles, see National Bureau of Economic Research, "U.S. Business Cycle Expansions and Contractions," http://www.nber.org/cycles.html.

[3] For more information, visit http://www.nielsen.com/content/dam/corporate/us/en/reports-downloads/2011-Reports/GlobalConsumerConfidenceReport_Q42010.pdf?wwparam=1319752536.

[4] For more information, see BLS Handbook of Methods, Chapter 1, "Labor Force Data Derived from the Current Population Survey" (Bureau of Labor Statistics, Apr. 17, 2003), http://www.bls.gov/opub/hom/homch1_a.htm.

[5] For more information, see "New and Existing Home Sales, U.S." (National Association of Home Builders), http://www.nahb.org/fileUpload_details.aspx?contentID=55761&fromGSA=1.

[6] For more information, see "Record 2.9 million U.S. Properties Receive Foreclosure Filings in 2010 Despite 30-Month Low in December" (RealtyTrac, October 2011), http://www.realtytrac.com/content/press-releases/record-29-million-us-properties-receive-foreclosure-filings-in-2010-despite-30-month-low-in-december-6309?wwparam=1320935470.

[7] The reference person is the first member mentioned by the respondent when asked to "Start with the name of the person or one of the persons who owns or rents the home." It is with respect to this person that the relationship of the other consumer unit members is determined.

[8] For each period represented in the tables, complete income reporters are ranked in ascending order according to the level of total before-tax income reported by the consumer unit. The ranking is then divided into five equal groups.

[9] For more information, see "Table 1. Quintiles of income before taxes: Average annual expenditures and characteristics, Consumer Expenditure Survey, 2010" (U.S. Bureau of Labor Statistics, September 2011), http://www.bls.gov/cex/2010/Standard/quintile.pdf.

Recommend this page using: