Consumer spending data from JPMorgan indicates that the economic recovery has been stuck in neutral since mid-June, mirroring data of weekly jobless claims and hours worked by service sector employees.
The chart, which measures use of select Chase credit and debit cards, showed that spending has been roughly 10% or more below its 2019 levels for over a month after rising sharply from its low point in late-March and early April.
Change in consumer spending by JPMorgan card users.
JPMorgan
The data, disclosed by JPMorgan research in a note to clients, shows a continued divergence between different sectors, with spending in supermarkets and wholesale retailers up year-over-year but sharp drops for restaurants, gas stations, lodging and airlines.
There was also a gap between different age groups. Spending by millennials and gen-z consumers was down 4.1% relative to last year, while spending by baby boomers was down more than 18%.
The stalled recovery in consumer period includes the period that will be reflected in the non-farm payrolls report for July, slated for release on Friday morning. Economists surveyed by Dow Jones are expecting an addition of 1.48 million jobs for the month, a marked slowdown from the 4.8 million gained in June.
Economists at the St. Louis Fed said in a blog post on Tuesday that the employment situation may have worsened since mid-July, when the nonfarm payrolls survey was conducted, based on data from the scheduling firm Homebase.
The slowdown in consumer spending encompasses a period that saw many cities and states reimpose economic restrictions to stem spiking cases of Covid-19, which has now killed at least 155,942 people in the United States, according to data from Johns Hopkins University.
Meanwhile, leaders in Washington are negotiating another economic relief package after the expanded unemployment benefits expired last week.
—CNBC’s Michael Bloom contributed to this report.
