To date, consumer spending has been the main buttress of earnings, so it would be disastrous for corporations if consumers close their wallets. On the other hand, corporate spending also has an important role in generating corporate earnings, and companies have compelling reasons to make capital investments. Shareholders' impatience with disappointing earnings could put pressure on CEOs to cut costs through capital improvements. U.S. Labor Dept. Capital investment looks like a bargain by comparison.
Capital expenditure is still about the substitution of capital for labor in a tight labor market.
If you do the calculations, there is still a reason to substitute capital for labor. Of course, wage pressure might also increase layoffs. Consumer confidence is the lowest it has been since 1996. Whether or not consumers will spend their windfall remains a matter of some debate. The apparent stabilization of the stock market and the continued strength of the housing market might give consumers the confidence to spend their tax cuts rather than save them.