Higher-income households, meanwhile, ratcheted up their spending on gas while barely reducing their consumption, according to a report from the Federal Reserve Bank of New York. Middle-income households fell in-between.
The gaps between how each group reacted were larger than in 2022, when a similar gas-price shock occurred after the Russian invasion of Ukraine, the report found. Higher-income households cut back more on their gas consumption four years ago than in March, while poorer households likely benefited more from government stimulus programs in 2022. Wealthier households have seen significant increases in the value of their stock and real estate holdings since then as well.
The figures suggest the gas-price surge has worsened what many economists call the “K-shaped economy.”