While oil and gas prices fell following Democrats’ midterm victory, should they seek to end the Iran conflict, experts say energy costs are unlikely to return to pre-war levels given the extent of the disruption to global oil flows caused by the conflict.
This leaves consumers in a precarious position, financial experts say. Even households that manage to meet their daily expenses can find themselves in credit card debt because of a single unexpected bill.
“Credit card debt usually has practical causes: medical bills, auto repairs, home repairs and everyday essentials such as gas and groceries are among the most common stories we hear from customers,” Rossman said. “Often the story goes something like this: ‘I was doing well until X happened.’ That is, until the surprise medical bill arrives. Or the roof was leaking. Or maybe the car broke down. This triggers a cycle of debt that is difficult to shake.
If there is a positive side, it is in the labor market, which remains in a situation of maintaining a low level of fire, even if hiring is weak. Many economists believe that as long as there is widespread employment and incomes providing a financial cushion, consumer spending is unlikely to collapse.
More recently, employment growth has shown some signs of stabilization. Over the past three months, job growth has averaged 137,000, compared to an average loss of 45,000 over the same period in 2025.
“The main support for consumer spending is being used,” said Kathy Bostjancic, chief economist at Nationwide Financial Group. With gasoline prices trending downward, consumers may start to see more of the light of day, she said.
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Yet wage growth remains stagnant, suggesting that employers are not yet raising the price of candidates. Meanwhile, the number of Americans out of work for six months or more continues to rise, reaching about 2 million at the end of October. This group now represents 27.6% of all unemployed workers, the highest share since December 2021, a sign of how difficult it can be to find a job.
Commentary on other recent earnings calls from consumer-facing companies paint a fractured consumer landscape, with some sectors showing resilience and others on shakier ground. This sentiment was echoed by Reynolds Consumer Products, maker of Reynolds Wrap and Hefty.
“Household budgets remain under pressure, and we continue to see this reflected in purchasing behavior across all of our categories,” said Reynolds CEO Scott Huckins, noting that shoppers are more aggressively seeking promotions and discounts or higher value bundles.
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