OK kids, 2026 is off to a great start! 😅💪 Are you hitting the gym? Eating enough protein? We know you wanna be in tip top shape before summer rolls around. Or else you’ll just be…rolling around? 🍩
Speaking of shapes, analysts came up with a letter-themed label that captures what’s currently happening in the economy. 📊 Let’s talk about it!
Here’s Five Fast Facts on the K-shaped economy:
- 👌 O.K. Corral - When you hear “K-shaped economy,” it’s referring to the way our current economy is split into two, like the letter K. In the upper part of the K, you’ll find wealthy Americans who are getting richer. In the bottom, you’ll find lower-income folks drowning in rising prices and weak wages.
- ↔️ Split Screen - Calling our economy K-shaped is a simple way to describe what’s happening. Although we’re technically in a growth period, the labor market is weak and unemployment is on the rise. Consumer spending is also on the rise, but consumer confidence is on the decline.
- 💸 Wage Script Flip - In 2023 and 2024, lower-income workers saw faster wage growth than higher earners…but things flipped in 2025. Pay for lower-income workers has dropped sharply to about 1.5%, now trailing higher earners at 2.4%.
- 🛒 Making It Rain - Over the last year, spending rose 2.7% among higher-income households but just 0.7% for lower-income groups. Recent consumer spending gains have been driven by wealthier Americans, while lower- and middle-income households rely more on credit cards.
- 🔮 Future Forecast - An economy powered mostly by wealthy spenders makes a lot of economists nervous. If job losses pick up, everyone else could slam the brakes on spending. We might also see bigger tax refunds and lower interest rates, which could lift growth but also boost inflation.
🔥Bottom line: Despite the horrors, we persist. And by “persist,” we mean filing our taxes. Not only do you have to keep the IRS off your back, but you also have to fight scammers. Head here to learn about the latest ways crooks are scamming American taxpayers.
Do you feel like we’re living in a split economy?
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