Persistent stressors have created 'resigned' consumer

Recurring stress from political and economic insecurity have created “resigned” consumers, according to Kearney’s most recent Consumer Stress Index.

The index, which is conducted by the strategy consultancy’s internal think tank Kearney Consumer Institute (KCI), is published quarterly and draws on a calibrated set of macroeconomic data and consumer input.

“Consumers around the world can only be described as 'resigned,' with political and economic insecurity manifesting stress differently from country to country," said KCI lead Katie Thomas, who heads up the ongoing research series. "In the US and some other Western countries, this has led to a perceived loss of agency, with consumers feeling powerless in the face of continued uncertainty. Amid this state of both persisting challenges and politics changing by the day, people feel they have less power over their lives and their future."

Heavy inflation – especially in housing, food, and transportation – have eroded buying power for lower-income Americans especially, where the above categories make up a much larger chunk of their paycheck. Add to that the political stress of an election where one result may lead to an authoritarian seizure of power and the dissolution of democratic institutions, and it’s just one stress on top of the other. What’s the point?

The US consumer stress index was up 2.3% in Q2 24 from Q1 24. The index’s consumer tracking is calculated from two elements: consumer flexibility, or agency in terms of perceived optionality and ability to impact conditions; and consumer sensitivity, or what issues are top of mind/how consumers are feeling. Data for Q2 24 was fielded in June.

Thomas says political stress feeds into financial stress, and the generalized stress of politics can lead to personalized stress attributed to the economy. As such, there is popular sentiment that jobs and personal finance are at risk even when figures on job growth and inflation actually paint a rosier economic picture.

In the Q2 report, geopolitics and government remained the top stressor, as it has in the last two quarters since the index was launched. In the US, more consumers are pessimistic (48%) than optimistic (29%) about the country’s political future.

According to Thomas, brands have their part to play in alleviating consumer stress.

“Our research found that two-thirds of Americans are living paycheck to paycheck—amid this, they need a source of reliability and consistency,” Thomas said. “Rather than contribute to uncertainty through practices like shrinkflation, brands have the ability to lend a sense of clarity and stability to our 'resigned' consumer."

That could mean delivering consistency and clarity in packaging, pricing, and marketing. It could also mean avoiding messaging that exacerbates politics- or technology-related stress.