Consumers are not only facing higher prices — they’re also feeling exhausted by the experience.

The Impact of Rising Costs on American Consumers

Many Americans are now accustomed to higher prices, and the financial strain is becoming increasingly evident.

Recent studies indicate that shoppers are feeling the effects of ongoing inflation and tariffs, which are influencing not only how much they spend, but also where and on what they choose to spend their money.

According to research from Simon-Kucher, only about a third of participants understood how tariffs affect them. However, the main takeaway for most was clear: costs are climbing, and families are shouldering the burden.

Another survey by the Kearney Institute found that consumers are not just spending less overall—they are also shifting their purchases between different categories, brands, and shopping channels.

• 54% reported dining out less frequently
• 44% reduced clothing purchases, with 21% opting for secondhand or resale items
• 37% switched to more affordable brands

Consumers Feel the Pressure of Persistent Price Increases

Since the onset of the COVID-19 pandemic in 2020, Americans have faced ongoing economic uncertainty, described by Shikha Jain of Simon-Kucher as a "perma-crisis." Supply chain disruptions, tariffs, and recent global events—such as fluctuations in oil and gas prices—have all contributed to rising costs.

The Simon-Kucher report notes that after years of financial challenges, people are not just adapting to higher prices—they are growing weary. Even small price hikes can feel significant when added to years of economic stress.

In the 2025 U.S. Consumer Tariff Market Study, conducted monthly since February 2025, 78% of respondents said inflation had affected them to some degree over the past three years.

The study also found that women, more than men, consistently reported feeling the financial squeeze.

Consumers noticed more price increases as 2025 progressed, with 60% observing higher costs for electronics. Price hikes were also noted for groceries, clothing, and household necessities.

Growing Sensitivity to Prices

Simon-Kucher’s research revealed that 80% of consumers are concerned about continued inflation, with many now perceiving everyday items as expensive.

Jain explained that shoppers are generally willing to accept up to a 5% price increase. Beyond that, they begin to reconsider their purchases—opting for less expensive alternatives, waiting for discounts, or forgoing purchases altogether.

How Retailers and Shoppers Are Adapting

Retailers often keep prices steady on essential goods like pantry staples, while increasing prices on less price-sensitive items. Some shoppers remain loyal to specific products, such as a favorite brand of peanut butter or chocolate, regardless of price changes. However, for other items, consumers are more willing to switch to store brands or lower-cost options.

Two recent studies confirm that shoppers are feeling worn down by persistent price hikes and are adjusting their buying habits accordingly.

How COVID-19, Inflation, and Tariffs Have Changed Shopping Habits

Major economic disruptions often lead to shifts in consumer behavior. During the pandemic, many people turned to online shopping and delivery services—first out of necessity, then for convenience.

Tariffs have further driven up prices, especially for goods imported from countries with high tariffs, particularly in East Asia. As a result, more consumers are embracing practices like upcycling, recycling, and shopping secondhand.

It remains to be seen whether these new shopping patterns will persist in the long term.

Consumers Appear Unpredictable, but Frustration Is Widespread

Katie Thomas of the Kearney Consumer Institute notes that, over the past year, consumers have been described as both cautious and selective, yet also willing to indulge on occasion. Her recent study explores these seemingly contradictory behaviors.

The research found that many people use shopping as a source of comfort and control, even as they face financial challenges. The study surveyed 24,000 people globally, including 2,000 in the U.S.

Thomas explained that while opinions differ on the effects of tariffs, nearly everyone is frustrated by the relentless rise in prices. In fact, 57% cited inflation and affordability as their top economic concerns.

Another Kearney Institute report examined how both lower- and higher-income households are responding in unexpected ways. Lower-income individuals are cutting back on essentials but still treating themselves occasionally, while wealthier consumers are opting for less expensive groceries but spending more on experiences.