WASHINGTON (AP) — Higher-income Americans and those with college degrees have ramped up their spending more quickly in the past three years than other consumers, according to new data released Tuesday, evidence of worsening inequality that may explain some of the growing pessimism about the economy.
The data, released by the Federal Reserve Bank of New York, also show that in the final three months of last year, lower-income and rural households faced higher inflation than higher-income households. The spending data focuses only on goods excluding autos, and does not capture likely spending by higher-income households on travel, restaurants and entertainment.
The figures add support to the notion of a “K-shaped” economy, in which upper-income Americans are fueling a disproportionate share of the consumption that is the primary driver of the economy, while lower-income households see fewer gains. Poorer households in general often experience higher inflation, with a greater share of their spending being set aside for goods that have seen prices soar since the pandemic, things like housing, groceries, and utilities.
The New York Fed's data show that households with incomes of $125,000 and higher have boosted their spending 2.3%, adjusted for inflation, since 2023, while middle-income households — those between $40,000 and $125,000 — have increased their spending by 1.6%. Those earning below $40,000 have lifted their spending by just 0.9%, the report showed.
The figures are an addition to the New York Fed's economic heterogeneity indicators, a series of data sets intended to track variations in the economy by geographic region and demographic and income groups. The goal is to get a better sense of how different groups are faring, trends that can be shrouded by nationwide averages.
The figures are derived from a group of 200,000 consumers tracked by the analytics firm Numerator. Their data closely tracks monthly retail sales released by the government, the New York Fed said.
The report underscores a pattern that has emerged since the pandemic: Lower-income households fared better in 2021 and 2022 when companies were desperate to hire and willing to pay, while the government also provided several economic stimulus checks. Yet beginning roughly in early 2023, hiring slowed and sharp gains in stock market fueled spending gains in wealthier households.
The division is also clear when examined through the lens of education. In 2023 and most of 2024, inflation-adjusted spending by non-college households fell below its January 2023 level. It only regained that level in November 2024, while households with a college graduate had by then boosted their spending by 4%.
The New York Fed notes that college-educated households continued to spend at a rapid pace in 2025 even as hiring slowed and there were a spate of job cuts in white-collar industries such as high tech, government and marketing.
“The difference in the trend in retail spending between college graduates and nongraduates is consistent with the story of a ‘K-shaped economy,’” Rajashri Chakrabarti, an economic research advisor at the New York Fed, and three colleagues wrote.
The findings echo other recent research, including a short paper by the Federal Reserve Bank of Dallas last November. The Dallas Fed found modest increases in consumption and income inequality over the past three decades. The wealthiest one-fifth of Americans accounted for about 54% of earnings from 1990-99, the researchers found, a figure that had risen to 60% in the 2020-2025 period. The proportion of spending by the richest one-fifth increased to 57% from 53% between those two periods, the Dallas Fed concluded.
FILE - Diners eat at a restaurant in the Meatpacking District of Manhattan, Nov. 22, 2024, in New York. (AP Photo/Julia Demaree Nikhinson, File)
WASHINGTON (AP) — New blood tests that might predict Alzheimer’s years before symptoms begin may sound tantalizing for people who worry about later-in-life dementia. But doctors say they aren't quite ready yet — and besides, you don’t need a test before trying to lower your risk.
The U.S. Food and Drug Administration has cleared four blood tests to help doctors diagnose whether Alzheimer’s — not another kind of dementia or something else — is behind someone’s memory problems or other cognitive symptoms. Some laboratories and online services offer their own tests. Faster diagnosis can help people with early-stage Alzheimer’s qualify for drugs that can modestly slow the worsening of their symptoms.
Yet dementia specialists say people without symptoms also seek those tests even though they’re neither approved nor recommended for that population.
For now, “the worried well should not be getting those tests” outside of a research study, stressed testing expert Nicholas Ashton, of Arizona’s Banner Health.
Instead, focus on addressing potentially preventable brain risks. One large study found people who reached middle age without high blood pressure, diabetes and smoking lived dementia-free for a lot longer — nearly 13 years longer — than people with all three of those common health problems in their 50s.
“Be aggressive,” advised Dr. Josef Coresh of NYU Langone Health, the study’s senior author. Even delaying those risky conditions “has a huge payoff.”
Like many people who have watched a loved one succumb to Alzheimer’s, Mark Yost wonders about his own risk even though he doesn’t have symptoms.
“I want to know what my status is,” said Yost, 60, of Phoenix. And if signs of trouble develop, “what I can do about it to either avoid it or slow it down.”
It's not clear what causes Alzheimer's, but its telltale markers are abnormal forms of two proteins. Sticky beta-amyloid can build into brain-clogging plaque over decades, eventually spurring neuron-killing tau tangles that lead to symptoms. Blood tests that measure a tau type called p-tau217 seem particularly good at reflecting amyloid buildup in people with symptoms.
As for the symptom-free, a study led by Mass General Brigham researchers found older adults with very high p-tau217 levels had a 38% risk of developing cognitive impairment within five years, and a higher risk over 10 years.
Here’s the rub: A “positive” test result is just a risk factor, not a guarantee someone will later develop Alzheimer’s, Ashton cautioned. Lots of older adults harbor high levels of amyloid but never show cognitive trouble. And while negative test results seem pretty reliable, a positive test sometimes is wrong, a so-called false positive.
Yost volunteered for a Banner blood test study that included cognitively normal people and learned his result was “intermediate,” defined as maybe having some amyloid but not a worrisome “elevated” level.
Yost found the uncertainty “a little disappointing” and something to watch as he gets older, while pursuing brain-healthy steps like exercise and a mentally stimulating genealogy hobby.
A major trial last year found that healthier habits slowed age-related cognitive decline in older adults who were at increased risk of developing dementia. Among the steps: A half-hour of moderately intense exercise four times a week, twice-weekly resistance training and following the MIND diet, which stresses lots of leafy greens and berries, whole grains, poultry and fish.
Dementia experts also advise getting enough sleep, avoiding social isolation, treating hearing loss and exercising your brain, not just your body. They say middle age is a key time to act.
As for those extra 13 dementia-free years, the NYU study reinforces that what's good for the heart is good for the brain.
Coresh's team analyzed health records of more than 12,000 people who had been tracked for decades since they were, on average, age 56. High blood pressure, Type 2 diabetes and smoking can damage blood vessels that feed the brain and fuel inflammation. Those who entered the study without those three problems fared best, but avoiding one or two was helpful. Even people who carry the APOE4 gene, which increases the risk of later-in-life Alzheimer's, still benefited from a healthier middle age.
Other studies also have shown that aggressively treating high blood pressure helps brain health.
“Be very serious with your physician about the value of lowering it as early as possible for as many years as possible,” Coresh said.
As for those Alzheimer's blood tests, stay tuned. Clinical trials are underway to tell if drugs now used to treat Alzheimer's might also help certain people before they develop symptoms — findings that could change testing advice.
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FILE - A doctor points to PET scan results that are part of a study on Alzheimer's disease at Georgetown University Hospital, on Tuesday, May 19, 2015, in Washington. (AP Photo/Evan Vucci, File)
