Inflation has been a rising issue of concern over the last few months. The CPI surged 8.6% in the last year—the highest level in 40 years. Gas prices, in particular, have surged, rising nearly 50% year-over-year. As a result, consumers pulled back on spending in May; retail sales dipped 0.3% from the previous month, with declines across most categories except for restaurants and bars, groceries and a few other categories. Real spending on durable goods dropped 3.5% month-over-month in May, while spending on services continued to grow moderately at 0.3%. As inflation surges, consumers have dipped into savings to bankroll purchases. The personal saving rate now stands at 5.4%—a significant drop from its high of 34% in April 2020 and half of its year-ago level of 10.4%. As a result, many parents responded that they would change the way they shop for Back-to-School products this year. In our survey, we discovered some key differences in the way higher-income and lower-income parents’ shop, as well as differences across generational cohorts.

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