Inflation Is So Bad, Even High-Income Americans Are Going to the Dollar Store
With inflation at a four-decade high and food prices being enormously affected, it’s no surprise that Americans — even those in higher income brackets — have been heading to discount stores for groceries.
According to Consumer Price Index (CPI) figures, the food at home index rose 12.2% in the past year and the overall food index increased 1% in June, bringing the latter category’s total increase to 10.4% for the 12 months ending June. This represents the largest 12-month increase since the period ending Feb. 1981, according to the Bureau of Labor Statistics (BLS). These figures are also higher than the overall inflation rate, which stood at 9.1% in June.
In turn, 90% of Americans say they are concerned about food prices, according to a Harris Poll survey. The Wall Street Journal reported that average spending on grocery products at discount chains increased 71% from Oct. 2021 to June 2022, according to analytics firm InMarket.
Dollar Stores, Discount Supermarkets See Shopper Surge
This is in line with a survey from Numerator, which showed that inflation is indeed changing shoppers’ habits. Dollar stores are seeing more high-income shoppers — which it describes as people with income greater than $80,000 — who are also switching to save. The Numerator survey found that dollar store sales are up by about 14%.
“As the cost of everyday goods continues to rise, consumers are shopping around to find value,” Eric Belcher, CEO of Numerator, said in a press release. “Many of these shifts, including high-income households trading down to dollar stores, are unexpected.”
Corroborating this concept, Insider reported that discount grocery chain Aldi is seeing “significant spikes” in traffic, as the chain added 2.5 million new customers in May — with the greatest increases in customer traffic coming from middle-income and high-income households.
The BLS data also showed that five of the six major grocery store food group indexes rose in June. In terms of specific food groups, the index for cereals and bakery products increased 2.1% in June, with the index for flour rising 5.3%. The dairy and related products index rose 1.7%, while the fruits and vegetables index increased 0.7%.
The only major grocery group index to decline in June was the index for meats, poultry, fish, and eggs, which fell 0.4% over the month as the indexes for beef and pork declined, the BLS noted.
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