American consumers, battle-scarred by the pandemic and the subsequent surge in inflation, are already changing their spending patterns and delaying some purchases due to President Donald Trump’s chaotic tariff policy and the broader economic uncertainty, new survey data shows. The shift in spending plans was among the findings from tax and audit firm KPMG’s second annual American Perspectives survey released early Thursday. The survey of 2,500 adults sought to evaluate their personal financial situations as well as how they were adapting to changing forces in the economy, including new tariffs, the rise of generative artificial intelligence and the role of higher education. The survey was conducted between April 3 and April 23 — a period that followed Trump’s April 2 announcement of a new slew of massive tariffs and a later pause of dozens of those tariffs. The survey period was before the recent de-escalation of the US and China trade war. Survey respondents indicated plans to hold off on some major purchases and scale back in other areas of their lives in order to not accumulate debt, according to KPMG. “Seeing them go through the Covid cycle and into this new cycle, they’re quickly adapting to their spend-smart initiatives as they look at their personal finances and ways to control costs and how they evaluate major purchasing decisions,” Matt Kramer, KPMG’s US products line of business leader, told CNN in an interview. “I think it took a little bit long the last cycle (the pandemic) where they just weren’t quite used to making those major adjustments, and maybe the cost of money was a little bit cheaper back then,” he said. But now, consumers appear to be signaling they have little appetite to incur new debt and are hunkering down more quickly. About 68% of respondents said they did not want to take on any more credit, according to the report. And many respondents surveyed by KPMG indicated they intend to cut back on purchases both large and small: 43% said they will delay buying a car because of tariffs, and 70% said they already were or planned to use free ad-supported TV as an alternative to ad-free streaming services. “They’re clearly looking at opportunities to save,” Kramer said. “They’re switching providers where it makes sense, whether that’s their streaming services, whether it’s looking at insurance providers.” Beyond tariffs and personal finances, KPMG’s survey showed that GenAI is playing an increasing role in people’s personal and work lives. About 45% of respondents said GenAI is having a significant impact on their day-to-day personal life as well as their professional life, up from 41% and 40%, respectively last year. The survey also showed that perceptions have shifted around higher education and that half of respondents said a degree is no longer essential for a well-paying career. “Apprenticeship, technical training and looking at how technology is advancing and how you can accelerate your skills much more quickly, all of that is playing in to those responses,” Kramer said.
Trump’s tariffs are changing the way Americans spend
TruthLens AI Suggested Headline:
"KPMG Survey Reveals Shift in Consumer Spending Amid Tariff Policies and Economic Uncertainty"
CNN
7.4
TruthLens AI Summary
American consumers are significantly altering their spending habits in response to President Donald Trump's tariff policies and ongoing economic uncertainties, as revealed by KPMG's second annual American Perspectives survey. Conducted among 2,500 adults, the survey highlights that many consumers, already grappling with the financial fallout from the pandemic and rising inflation, are postponing major purchases to avoid accumulating debt. The survey was conducted shortly after Trump's announcement of new tariffs on April 2, which contributed to a climate of economic unpredictability. According to the findings, a notable 68% of respondents expressed a reluctance to take on additional credit. This shift indicates a growing consciousness among consumers to manage their personal finances more prudently, with many opting to delay significant expenditures, such as car purchases, and seeking cost-saving alternatives in their daily lives, including switching from subscription-based streaming services to free ad-supported options.
The survey also highlights the evolving landscape of consumer priorities, moving beyond tariffs to include the impact of generative artificial intelligence (GenAI) on personal and professional lives. Approximately 45% of respondents reported that GenAI is significantly affecting their daily routines, reflecting a growing integration of technology into everyday activities. Additionally, attitudes towards higher education are shifting, with half of the respondents indicating that a degree is no longer seen as essential for securing a well-paying job. This suggests a broader trend towards valuing practical skills and alternative training routes, such as apprenticeships and technical education, which are increasingly recognized as viable paths in the modern job market. Overall, these findings illustrate a transformative moment for American consumers as they adapt to new economic realities and changing societal norms regarding education and technology.
TruthLens AI Analysis
The article highlights the changing spending habits of American consumers amid economic uncertainty influenced by President Trump's tariff policies. It cites a survey conducted by KPMG, emphasizing how consumers, already burdened by the pandemic and rising inflation, are now more cautious about their financial decisions. The findings suggest a significant shift in consumer behavior, indicating a reluctance to incur new debt and a tendency to postpone major purchases.
Economic Impact on Consumer Behavior
The article suggests that the economic landscape, marked by Trump's tariffs and inflation, is compelling consumers to reassess their financial priorities. The survey reveals that a substantial majority of respondents are avoiding new credit, which points to a collective recognition of the need for financial prudence. This behavioral shift may reflect a broader trend where consumers are more adaptive to financial pressures compared to previous cycles, like the pandemic.
Perception and Public Sentiment
The intention behind the news could be to inform the public about the tangible consequences of political and economic decisions on everyday life. By leveraging survey data, the article aims to create a narrative that underscores the seriousness of the economic climate and the need for consumers to adjust their spending habits. This may resonate particularly with those feeling the pinch of inflation and uncertain economic conditions.
Potential Omissions
While the article focuses on consumer caution and the impact of tariffs, it may not delve into other significant factors contributing to economic uncertainty, such as external geopolitical influences or the complexities of the global supply chain. This selective focus could suggest a desire to steer the public narrative towards the implications of domestic policy without addressing the full scope of economic challenges.
Manipulative Aspects
The article's framing could be seen as somewhat manipulative if it emphasizes the negative impacts of tariffs without equally highlighting any potential benefits, such as protecting domestic industries. The choice of language and the emphasis on consumer anxiety might provoke a more alarmist response from readers, potentially shaping public discourse around economic policy in a particular direction.
Comparative Context
When compared to other news articles discussing economic trends, this piece aligns with a broader media narrative that often portrays consumer sentiment as a reflection of political decisions. This connection can reinforce the perception that consumers are directly influenced by government actions, potentially leading to a more engaged and reactive public.
Market Implications
The implications of this news could extend to financial markets, particularly if consumer spending continues to decline. Companies reliant on consumer goods and discretionary spending might face challenges, which could lead to fluctuations in stock prices. Investors may closely monitor consumer sentiment data and related economic indicators to gauge market stability.
Broader Geopolitical Considerations
From a global perspective, the tariffs and their impact on consumer spending could play a role in shaping trade relations, particularly with China. The article hints at broader economic dynamics that could influence U.S. standing in global markets, especially if consumer confidence continues to wane.
AI Involvement
There’s a possibility that AI tools were used in drafting or analyzing survey results, given the structured presentation of data. However, the narrative appears to be crafted more through traditional journalistic means rather than heavily relying on AI-generated content. The focus on consumer adjustment strategies suggests a human element in interpreting the data.
In conclusion, the article presents a reliable overview of how tariffs are shaping consumer behavior in the U.S. It effectively uses survey data to highlight current economic concerns, but there may be an underlying agenda to emphasize the negative impacts of government policy while omitting broader economic factors. Overall, readers should approach the information with an understanding of its context and potential biases.