On the basis of data from the Consumer Expenditure Survey (CE), consumers spent less 

in 2010, compared with 2009, on almost all 

major components of the household budget. 

Average annual expenditures per consumer 

unit (CU)1

 fell 2.0 percent, and average annual 

income before taxes dropped 0.6 percent, the 

second consecutive yearly decline for both of 

these measures. (See table 1.)

Overview of Spending

• Entertainment expenditures, which

tend to be more discretionary, fell 7.0

percent in 2010, the most in percentage terms of any category. All subcomponents of entertainment spending

fell, with fees and admissions spending

reduced by 7.5 percent.

• Overall food spending decreased 3.8

percent. Spending on food away from

home fell more than spending on food

at home, 4.4 percent versus 3.4 percent, respectively. Consumers spent

6.9 percent less on going out to dinner,

a subcomponent of food away from

home, in 2010.

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Consumer Spending

in 2010

1

Consumer Expenditure Survey, 2010

U.S. Bureau of Labor Statistics December 2011 Volume 2, Number 12

• Mortgage interest payments and

charges, a subcomponent of housing,

fell 6.8 percent, evidence of the continued weakness of the housing market

in the nation.

• Donations to charities and other organizations fell 23.4 percent, and charitable giving to churches and religious

organizations dropped 8.8 percent.

• Healthcare, one of two major spending components that increased, rose

1.0 percent. The 2.6-percent jump

in health insurance spending, a subcomponent of healthcare, fueled the

healthcare increase.

• The 0.2-percent increase in transportation spending was driven by a 7.3-percent rise in gasoline and motor oil

expenditures.

Although the latest U.S. economic recession 

officially ended in June 2009,2

 lasting effects 

were felt throughout the economy in 2010. 

The drop in spending can be attributed to 

many factors, including faltering consumer 

confidence, high unemployment rates, and a 

depressed housing market. According to the 

Nielsen Company, consumer confidence in 

the United States sagged throughout 2010. 

The Nielsen Consumer Confidence Index, 

which is reported quarterly, indexed U.S. 
2

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consumer confidence at 81 for the final two 

quarters of 2010, the lowest confidence 

level for U.S. consumers during the year. 

(Levels above an index of 100 indicate degrees of optimism.)3

 The monthly national 

unemployment rate, as measured by the 

Current Population Survey (CPS), never fell 

below 9.4 percent in 2010. This was the first 

calendar year since the CPS started collecting employment data in 19484

 that the 

monthly unemployment rate was above 9.0 

percent for every month. Sales of new and 

existing homes fell for the fourth consecutive year.5

 Foreclosure filings, which include 

default notices, scheduled auctions, and 

bank repossessions, were levied on a record 2.9 million U.S. properties.6

 

Spending highlights

CE data have reflected several mediumto long-term spending trends in the U.S. 

economy:

•	 For CUs which indicated that they were 

homeowners, mortgage interest and 

charges, a subcategory of housing, 

has been declining since 2007. The 

spending level in 2010 was 13.1 

Table 1. Average annual expenditures and income of all consumer units and percent 

changes, 2008–2010

Item 2008 2009 2010 Percent change

2008–2009 2009–2010

Income before taxes $63,563 $62,857 $62,481 –1.1 –0.6

Average annual

 expenditures

50,486 49,067 48,109 –2.8 –2.0

 Food 6,443 6,372 6,129 –1.1 –3.8

 At home 3,744 3,753 3,624 0.2 –3.4

 Away from home 2,698 2,619 2,505 –2.9 –4.4

 Housing 17,109 16,895 16,557 –1.3 –2.0

 Apparel and services 1,801 1,725 1,700 –4.2 –1.4

 Transportation 8,604 7,658 7,677 –11.0 0.2

 Healthcare 2,976 3,126 3,157 5.0 1.0

 Entertainment 2,835 2,693 2,504 –5.0 –7.0

 Cash contributions 1,737 1,723 1,633 –0.8 –5.2

 Personal insurance and

 pensions

5,605 5,471 5,373 –2.4 –1.8

 All other expenditures 3,376 3,404 3,379 0.8 –0.7

Source: Bureau of Labor Statistics, Consumer Expenditure Survey.
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percent less than the level in 2007 

($5,042 versus $5,799). This drop in 

spending is evidence of the decline in 

the housing market and the resulting 

lower interest rates and increasing 

foreclosure rate. The CE also measured 

fewer homeowner CUs in 2010 than in 

2007 (79.5 million versus 80.2

million). 

•	 Advances in technology have changed 

the spending habits of many Americans. For example, the level of spending on cellular phone services has 

been on the rise, increasing from $210 

in 2001 to $760 in 2010, while the level 

for residential phone services has declined, dropping from $686 in 2001 to 

$401 in 2010. (See chart 1.)

•	 Computer ownership has also been 

on the rise. In 2001, the percentage of 

CUs owning a personal computer was 

54 percent. By 2010, the percentage 

owning a computer had climbed to 79 

percent, a 25-percentage-point increase 

in the 10-year period. Along with the 

increase of the number of CUs owning a computer, the average number 

of personal computers owned within a 

household more than doubled during 

the period, from 0.62 in 2001 to 1.29 in 

2010. The increase in computer ownership, coupled with increases in Internet 

$200

$300

$400

$500

$600

$700

$800

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Cell phone services Residential phone services

Nominal dollars

Chart 1. Average annual expenditures on cell phone and residential

phone services, 2001–2010

SOURCE: U.S. Bureau of Labor Statistics, Consumer Expenditure Survey.
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access expenditures, could be one reason why spending on reading materials, 

including newspapers, magazines, and 

books has declined from $141 in 2001 to 

$100 in 2010. 

Other interesting spending patterns can 

be analyzed by breaking the data down by 

socioeconomic characteristics:

•	 CUs with a reference person7 65 years 

and older allocated 13.2 percent of 

their total expenditures to healthcare, 

compared with 2.8 percent allocated 

by CUs with a reference person under 25 years of age. (See chart 2.) This 

difference in percent allocated shows 

why the aging population is much 

more vulnerable to increases in healthcare costs. The healthcare expenditure 

level also is much higher for older CUs: 

$4,843 for the 65-and-older group versus $775 for the under-25-years group. 

The under-25-years cohort also allocates much less of its spending to cash 

contributions, relative to the 65-yearsand-older group; 1.1 percent versus 6.2 

percent, respectively. Cash contributions include donations to churches, 

charities, and other organizations. 

The personal insurance and pensions 

component makes up 7.4 percent of 

the under-25-years group budget and 

only 5.1 percent for the 65-years-andolder group. 

15

20

25

30

35

40

Under 25 years 65 years and older

Percent

Chart 2.  Shares of average annual expenditures spent on major components

for selected ages, 2010

0

5

10

Food Housing Apparel

and

services

Transpor‐

tation

Healthcare Enter‐

tainment

Cash

contrib‐

utions

Personal

insurance

and

pensions

All other

SOURCE: U.S. Bureau of Labor Statistics, Consumer Expenditure Survey
5

•	 The CUs in the two lowest quintiles of 

income before taxes8 allocated a relatively small share of their expenditures 

to pensions and Social Security, compared with those in the highest two 

income quintiles. Less than 5 percent 

is allocated by each of the lowest two 

quintiles, while more than 11 percent 

is allocated by each of the highest 

two. This difference could be because 

Notes

1Consumer units include families, single persons living alone or sharing a household with others but who are financially independent, or two or more persons living together who share expenses.

2For more information on U.S. business cycles, see National Bureau of Economic Research, “US Business Cycle Expansions and 

Contractions,” http://www.nber.org/cycles.html. 

3For more information, visit http://www.nielsen.com/content/dam/corporate/us/en/reports-downloads/2011-Reports/GlobalConsumerConfidenceReport_Q42010.pdf?wwparam=1319752536. 

 4For more information, see BLS Handbook of Methods, Chapter 1, “Labor Force Data Derived from the Current Population Survey” (Bureau of Labor Statistics, Apr. 17, 2003), http://www.bls.gov/opub/hom/homch1_a.htm. 

5For more information, see “New and Existing Home Sales, U.S.” (National Association of Home Builders), http://www.nahb.

org/fileUpload_details.aspx?contentID=55761&fromGSA=1. 

6For more information, see “Record 2.9 million U.S. Properties Receive Foreclosure Filings in 2010 Despite 30-Month Low in 

December” (RealtyTrac, October 2011), http://www.realtytrac.com/content/press-releases/record-29-million-us-propertiesreceive-foreclosure-filings-in-2010-despite-30-month-low-in-december-6309?wwparam=1320935470. 

7The reference person is the first member mentioned by the respondent when asked to “Start with the name of the person or one of 

the persons who owns or rents the home.” It is with respect to this person that the relationship of the other consumer unit members is 

determined.

8For each period represented in the tables, complete income reporters are ranked in ascending order according to the level of total 

before-tax income reported by the consumer unit. The ranking is then divided into five equal groups.

9For more information, see “Table 1. Quintiles of income before taxes: Average annual expenditures and characteristics, Consumer 

Expenditure Survey, 2010” (U.S. Bureau of Labor Statistics, September 2011), http://www.bls.gov/cex/2010/Standard/quintile.

pdf. 

a higher proportion of students and retirees are in the lowest income quintiles.9

For more information on the availability of 

current or earlier CE tabular data or microdata, 

contact the Division of Consumer Expenditure 

Survey, Bureau of Labor Statistics, 2 Massachusetts Avenue, NE., Room 3985, Washington, 

DC 20212-0001. Telephone: (202) 691-6000. 

Email: cexinfo@bls.gov. Online: http://www.

bls.gov/cex/. 

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