According to the U.S. Bureau of Labor Statistics, an American household earning an annual income of $94,003 spent about $72,967 on consumer goods in 2022. Housing costs accounted for over 33% of the total expenditures for goods and services.
Key Takeaways
- Consumer goods are products manufactured and sold for final consumption by the purchaser.
- Non-durable consumer goods are consumed immediately or have a life span of fewer than three years—examples are food and clothing.
- Durable consumer goods have a life span of over three years and include cars and furniture.
What Are Consumer Goods?
Consumer goods are also known as retail goods and include food, clothing, electronics, jewelry, personal hygiene products, household cleaning products,furniture, books, magazines, tools, and other outdoor equipment. The purchasers of consumer goods do not resell the goods but will use them daily. Expenditures on consumer goods account for nearly one-third of total consumer spending annually.
Consumer goods include durable and non-durable consumer goods. Durable consumer goods are products with a lifespan greater than three years, such as cars, furniture, and appliances. Non-durable consumer goods are consumed immediately like food or clothing.
In the United States, measuring the amount of money spent on consumer goods is key to calculating the country's gross domestic product (GDP), which measures the size of the economy and growth rate.
Consumer Spending
A subcategory of consumer goods, consumer staples are products individuals consider essential and buy the most. These products include beverages, food, household items, and tobacco. Other consumer goods that people buy regularly are cleaning products, personal hygiene items, andclothing.
According to the U.S. Bureau of Labor Statistics, an American household earning an average income of $94,003 before taxes in 2022 allocated annual spending on average to:
- Food at home: $5,703
- Food away from home: $3,639
- Apparel and services: $1,945
- Vehicle purchases: $4,496
- Gasoline, other fuels: $3,120
- Personal care products and services: $866
- Entertainment: $3,458
What Affects Consumer Spending?
Consumer spending can reflect fluctuations in economic conditions. Expenditures for jewelry, electronics, and automobiles are typically subject to the greatest fluctuations. These are areas where consumers tend to cut back their expenses substantially during difficult economic times when they have less disposable income remaining after paying for basic expenses such as food, housing, and utilities.
Why Is Consumer Spending Used as an Economic Indicator?
Consumer spending, which includes consumer goods and other expenditures like housing and transportation,is reported monthly and considered a leading economic indicator. The goods and services purchased by those in the United States help gauge the economy's strength.
How Can the U.S. Government Boost Consumer Spending?
During periods when the overall economy and consumer spending are sluggish, the U.S. government sometimes attempts to stimulate spending through tax cuts. Such tax cuts can increaseconsumer spending and boost the overall economy. The effectiveness of this tactic is limited during times of high unemployment since the effects of higher unemployment tend to offset extra consumer spending by those employed.
The Bottom Line
Consumer goods include durable and non-durable consumer goods. In 2022, Americans spent over one-third of their income on housing. An additional third of income was spent on food and transportation. Changes in consumer spending reflect economic conditions and are monitored by the Bureau of Labor Statistics and the Bureau of Economic Analysis.
FAQs
Consumer Spending
What do Americans spend the most on? ›
Average American household expenses
According to the BLS survey, the largest expenditures were housing and transportation, which comprised 26 percent and 13 percent of people's pay, respectively. Another big spending category was food, to which 10 percent was devoted.
What is the most common consumer product? ›
Common examples of these are food, beverages, clothing, shoes, and gasoline. Consumer services are intangible products or actions that are typically produced and consumed simultaneously.
What do people purchase the most? ›
Electronics and Gadgets: Products like laptops, tablets, and other electronic devices are in constant demand. Clothing and Apparel: Fashion items are always in demand as people continuously seek new styles and trends. Food and Beverages: Basic necessities like food and beverages are universally in demand.
What kinds of things did American consumers buy in the 1920s? ›
The prosperity of the 1920s led to new patterns of consumption, or purchasing consumer goods like radios, cars, vacuums, beauty products or clothing. The expansion of credit in the 1920s allowed for the sale of more consumer goods and put automobiles within reach of average Americans.
What do American consumers spend most of their money on? ›
The average annual expenditures for 2022 were broken down into 14 major components (table B). Overall, housing accounted for the largest share (33.3 percent), followed by transportation (16.8 percent), food (12.8 percent), personal insurance and pensions (12.0 percent), and healthcare (8.0 percent).
What is the #1 consumer item in the world? ›
What Is The Most Sold Item In the World? The most sold item in the world is clothing and fashion items. This ranges from women's and men's outfits to children's clothing, shoes, accessories, and more.
What is the most sold item in the world? ›
Clothing is the most purchased item in the world. Whether its clothing for women, men or children, the industry is booming.
What do Americans buy the most online? ›
Among U.S. consumers the two most popular categories for online purchases are Clothing and Shoes. 43 percent and 33 percent of consumers respectively chose these answers in our representative online survey. The survey was conducted online among 10,046 respondents in the United States, in 2023.
What item did Americans desire the most to buy in the 1920s? ›
During the 1920s, many Americans had extra money to spend—and spend it they did, on movies, fashion and consumer goods such as ready-to-wear clothing and home appliances like electric refrigerators. In particular, they bought radios.
Cars were the symbol of the new consumer society that emerged in the 1920s. In 1919, there were just 6.7 million cars on American roads. By 1929, there were more than 27 million cars--or nearly one car for every household in the United States.
What was the most important consumer product in the 1920s quizlet? ›
-Automobile was the most important consumer product of the 1920's. What unintended affects did prohibition have? -Due to the ban of intoxicating liquors, bootleggers gained substantial power and had control over the corrupt law enforcement.
What do Americans spend the most money on every year? ›
The most recent data from the US Bureau of Labor Statistics shows that American consumers spend the most money on housing. In 2022, the average US consumer spent $24,298 on housing, which made up one-third (33.3%) of their total annual expenditure.
What do American adults spend the most money on annually? ›
Americans spent the most on housing, at 24,298 U.S. dollars, reflecting around one third of annual expenditure. The total average U.S. consumer spending amounted to 72,967 U.S. dollars.
