US Consumer Spending during the pandemic
US Consumer Spending during the pandemic

US Consumer Spending in 2020

Most people are aware that there has been a significant impact on the economy since the beginning of the coronavirus pandemic and the various US shutdowns. How has US consumer spending changed in 2020?

I bumped into a great website with some fantastic data about how the economy is and how the economy is not recovering since the pandemic took over our lives. has some great insight into what’s going on, but there’s actually very little explanation or insight into this data. So we will do a short series on how we read this data.

Overall Consumer Spending

The data available on consumer spending is updated as of December 6th, so the full impact of holiday shopping is not fully reflected. The chart below is the main chart available on the site for spending:

US Consumer Spending during the pandemic as compared to January 2020.
US Consumer Spending in 2020

As indicated above, the total of all consumer spending has almost completely bounced back since the pandemic took hold, with total spending as of 12/6/2020 down only 1.7% from the pre-pandemic levels in January 2020.

When the national emergency was declared on March 13th, spending was actually up a little over 1% at this time, but as you can see in the chart, that spending quickly plummeted. There are 2 different bottoms in April: the low points – both down 32.4% from the January levels. Things did begin to recover before the first round of stimulus checks going out, but spending was still down by over 20% until May.

Spending hopped up and down between down 5% and down 10% from the beginning of June until the beginning of August when there was a very steady increase to the reading on September 6th of being down by only 1.6%. From September until Thanksgiving, spending wavered, being down ‘around’ 5% during much of the period and broke to near break-even (estimated – per the dotted line in the chart) to being down only 0.4% around November 18th.

How has consumer spending changed?

With consumer spending nearly back to January levels, we all know that what we are spending our money on is very different from the pre-pandemic days. I, for one, have not been on vacation, rarely go out to dinner, and have overall become quite the hermit since those carefree days early last year.

According to the data, what has had the most positive and negative impact during the pandemic? By far, the two hardest-hit industries have been Transportation (airlines) and Entertainment & Recreation. I was surprised that restaurants were not harder hit than they were. The chart below illustrates these two hard-hit industries. The current consumer spending levels on Transportation are down 46.4%, and spending on Entertainment is down 51.8%. If anyone has questioned why airlines have been borrowing money, issuing stock, and begging the government for help, this is why.

Consumer spending chart on transportation and entertainment during the pandemic.
US Consumer spending on transportation & entertainment during the pandemic.

The dark blue line above represents overall spending; the red line illustrates the decline in Entertainment spending, and the cyan (light blue) line represents spending on Transportation. Spending in Restaurants initially dropped by over 66% at the bottom in April but has only recovered halfway and is currently down by 25.9% compared to January. This is one of the hardest-hit industries for business closures in the last year.

Shockingly, healthcare spending is down compared to January levels, with spending currently down 24.9% after bouncing back to levels above January early in the summer of 2020, but that quickly reversed and has spent much of the year down 10-15% from January 2020 levels.

Spending in two industries is well above where it was a year ago. With such a big decline in consumer spending at restaurants, it makes sense that the strongest industry is Grocery stores because everyone still needs to eat. Currently, grocery spending is up 24.8% in December as compared to January 2020 levels. Remember everyone stocking up on EVERYTHING from toilet paper to yeast to canned goods back right before our economy began to shut down? Well, spending at grocery stores peaked at +68.8% around March 18th (see the chart below) before spending most of the year is up about 10% compared to January.

In addition to grocery shopping, there’s been a tremendous increase in retail-therapy during the pandemic, led at least to a degree by home improvement spending. Retail spending after an initial decline of 23.5% in early April, retail spending spent most of the year being up 7-12% above January 2020 levels and is currently 14.2% above those levels.

Consumer spending chart illustrating grocery and retail spending as compared to overall consumer spending
Grocery & Retail spending is well above January levels.

What’s up next?

Nobody can predict what a new presidential administration and Congress will do when they first get into office. However, with covid cases still incredibly high and deaths extremely high, we assume that something will happen to try to shut things down. [we obviously don’t know for sure.] The UK has just announced that everyone needs to stay home until the middle of February, and if that happens in the US, there’s going to be more pain to come in the economy.

We will be updating this story as more data becomes available.

Kurt Tietjen
Kurt has been in the online media business as long as it's been a business. Former SVP of Operations for, Chief Traffic Officer (head of audience & product) for Purch (formerly Tech Media Network), founder of High Peak Media and many other positions in businesses that no longer exist.