McDonald's CEO warns of 'a two-tier economy' as lower-income consumers spend less

McDonald’s is expanding its value meal menu.

McDonald’s is expanding its value meal menu. The reason suggests growing trouble in the economy, analysts say.

In an interview Tuesday on CNBC, McDonald’s CEO Chris Kempczinski said the move was in response to growing evidence of a divided consumer landscape: While upper-income households continue to spend freely, the rest are struggling.

“Particularly, with middle- and lower-income consumers, they’re feeling under a lot of pressure right now,” Kempczinski said. He added: “It’s really kind of a two-tier economy.”

The idea that the economy is bifurcating is not new — but the trend seems to be becoming more pronounced. It began bubbling up more recently as the Covid-19 pandemic showed signs of waning and stocks started to surge. Pandemic assistance from the government helped level the playing field for a time, but by 2024, mounting inflation pressures and elevated interest rates had begun to re-sort consumers according to their ability to withstand financial stress.

By the start of 2025, the richest 10% of Americans, or those earning at least $250,000 a year, accounted for half of all consumer spending, a record, according to Moody’s Analytics. By comparison, the richest 10% accounted for 36% of all consumer spending 30 years ago.