Sticky inflation, white-collar layoffs, and surging interest rates are all putting pressure on a certain type of American — higher-income earners.
"What we normally see in an economic recession is that lower- and moderate-income households really bear the brunt of it in terms of job losses and financial hardships," said Greg McBride, senior financial analyst at Bankrate.com. "We haven't seen that."
The stock market, a source of wealth for the rich, struggled in 2022. The S&P 500 sank more than 19%. The same year, 1.8 million Americans lost their millionaire status, according to UBS' 2023 Global Wealth Survey. Despite the stock market's summer rally in 2023, the U.S. economy still faces several headwinds.
Bank of America's Consumer Checkpoint Survey for September 2023 found that high-income households have become more pessimistic about the economy. The same group also appears more cautious about spending because of soft wage growth and slowing job creation for high earners.
Watch the video above to find out more about how the so-called "richcession" could affect the entire economy.