Record profits, terrible service: something’s got to give for US consumers

U.S. consumer sentiment has fallen to a record low while corporate profits reach post-war highs, according to University of Michigan data, as decades of industry consolidation leave Americans with fewer alternatives and rising frustration over prices and service. The University of Michigan's consumer sentiment index, tracked for more than 60 years, hit a new low amid cost-of-living increases that many say are eroding personal finances [1]. Customer complaints about goods and services surged 16% in the first quarter, reaching record levels according to the university's American Consumer Satisfaction Index, which has tracked the figure since 1994 [1]. Claes Fornell, the index's founder, wrote in May that customer retention has paradoxically increased, noting that unhappy customers stay because they believe another company will treat them as badly or they simply have no alternative [1]. Corporate profits after tax jumped sharply during the Covid-19 pandemic, hitting a seasonally adjusted annual rate of $3.7tn by the end of 2024, roughly double the level in 2012 [1]. Despite tariff impacts and the U.S. and Israel war with Iran, profits climbed again to $3.9tn in the first quarter of 2026 [1]. As a percentage of gross domestic product, corporate profits reached a post-Second World War high of 15.8% in the fourth quarter of 2025, while employee compensation as a share of GDP dropped to less than 10% [1]. KPMG chief economist Diane C Swonk described the gap as "a measure of inequality, which creates social and economic instability" [1]. The period since 2016 has been described by historians as part of a Second Gilded Age driven by increasing wealth inequality [5]. The St. Louis Fed's economist Ricardo Martin explained that the pandemic "accelerated the transition toward the digital economy, which likely helped firms, particularly those in the retail and wholesale trade industries, produce more with fewer resources" [1]. Sergio Ocampo, an economics professor at the University of Western Ontario, noted that the cost of retail goods compared to income fell 33% between 1990 and 2012, a decline he said is "almost impossible to achieve without the efficiency gains from consolidation" [1]. Those price declines stalled by the end of the 2010s, and the infrastructure controlled by giant companies now presents a hurdle to new entrants [1]. In the airline sector, over 20 carriers in the 1970s have merged into seven, with just four airlines controlling nearly 70% of total market share [1]. Delta Air Lines, a founding member of the SkyTeam alliance, ranks first in revenue and brand value among the world's largest airlines [9]. Aeroméxico, the flag carrier of Mexico, operates scheduled services to more than 120 destinations and works closely with Delta through a joint commercial agreement that took effect in 2017 [8]. When Delta charged economic historian Marie Duggan $1,200 to change a scheduled flight, she cancelled and instead took a $250 Aeroméxico flight to Hermosillo followed by a $59 bus across the Mexico border [1]. "I thought, 'Ha! You think I have no choice, but I know that there is a bus,'" Duggan said [1]. Cory Doctorow, author of a book on declining service quality, compared the dynamic to an airport vendor charging $15 for water past the security checkpoint. "It's not because they're evil, it's because you can't go anywhere else to buy your water," he said [1]. Alexander DePaoli, a Northeastern University marketing professor, said consumers are becoming "reactive" and starting to see brands as "a rival or an adversary" [1]. Michael Mooney, a retired small business owner in Michigan, said Spectrum charged him $170 per month for internet with no alternative provider available. "What a racket. I thought regional monopolies were illegal," he said [1].