BOSTON—March 20, 2025—Back-to-back deteriorations in the outlook for American consumers’ future spending among both middle- and upper-income households since the end of last year indicate clouds continue to gather over US consumer prospects amid increased housing market risks and the stock market sell-off, according to the latest results of the Bain & Company/Dynata Consumer Health Indexes.

The Consumer Health Indexes (CHI) consumer outlook score for middle-income Americans fell for a third month in a row in March, while the CHI outlook gauge for the critical upper-income group, which accounts for more than 50% of US discretionary consumer spending also continued to trend down and dropped for a fourth consecutive month.  

The combination of declining outlook readings for both groups cast a further shadow over the US consumer, the Bain/Dynata analysis suggests, following the rise in American’s savings intentions highlighted in the CHI report for February which suggested consumers could revert to pre-pandemic norms of lower spending and higher savings.

The decline in the outlook score for  middle-income Americans saw this fall by 1.3 points in March, leaving this at 100.4, down 2.7 points over three months. The Bain/Dynata report notes that this leaves the middle- income outlook gauge at a neutral level but concludes that three monthly falls in a row is a notable trend.  

The findings pin the blame on worsening conditions in the US housing market. Price prospects for houses, typically middle-income Americans’ primary asset, are the key driver of the Bain/Dynata assessment of their outlook as consumers.

Risks of a US housing downturn are increasing, the Bain/Dynata analysis cautions, citing reports that stocks of housing for sale are reaching record levels in some states while also building rapidly in many more.

“We suspect some middle-income earners are growing increasingly wary of the housing market in their metros – consistent with recent reports of inventories spiking in some markets ahead of the summer selling season. If the housing market falters in the coming months, the current downtrend in our middle-income outlook index could expand to middle-income spending, raising the prospect of a loss of demand in the broader economy,” said Brian Stobie, senior director in Bain & Company’s Macro Trends Group.

The consumer outlook score for upper-income Americans also remains in neutral territory in the CHI March survey results but nevertheless fell for a fourth straight month. While housing is the key outlook driver for the middle-income group, equity markets are the key factor for the upper-income group. But despite the ongoing correction is the US stock markets, the Bain/Dynata analysis reports that the current outlook gauge for upper-income Americans remains around the mid-range of levels during the last market correction between May 2022 and March 2023.

Stobie added: “Since the upper-income outlook is tied to perceptions of future portfolio performance, market developments in the coming weeks will be a critical determinant of how things unfold. Our data indicates that caution, rather than panic, has taken hold for upper-income earners who are waiting to see next developments in markets. If markets continue to sell-off, so that the outlook readings in our data fall further, then the upper-income group could easily scale back their spending. Given this group accounts for a disproportionate share of spending, such a shift could produce significant downward pressure on the wider US economy.”

For more details and the full report (PDF), please click here or get in touch via the media contacts below.

 Media contacts 

To arrange an interview or for any questions, please contact:

Gary Duncan (London) — Email: gary.duncan@bain.com

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About Bain & Company

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About Dynata

Dynata is the world’s largest first-party data company for insights, activation, and measurement. With a reach that encompasses 70 million consumers and business professionals globally and an extensive library of individual profile attributes collected through surveys, Dynata is the cornerstone for precise, trustworthy quality data. The company has built innovative data services and solutions around its robust first-party data offering to bring the voice of the customer to the entire marketing continuum — from uncovering insights to activating campaigns and measuring cross-channel marketing return on investment. Dynata serves more than 6,000 market research, media and advertising agencies, publishers, consulting and investment firms, and corporate customers in North America, South America, Europe, and Asia-Pacific. Learn more at www.dynata.com