Household Spending Patterns and Hardships during COVID-19: A Comparative Study of the U.S. and Israel

The combined supply and demand shocks of the COVID-19 pandemic have created the largest consumer behavior shift in recent history, while exposing millions of households to material hardships like food insecurity and housing instability. In this study, we draw on national surveys conducted early in the pandemic to investigate the pandemic’s effects on self-reported consumer spending behaviors and experiences of hardship for households in the US and Israel; two countries that are similar in terms of their development but have had divergent experiences with and responses to the pandemic. We also examine the extent to which racial/ethnic/religious minority status and pre-pandemic employment characteristics predict these outcomes. Using descriptive and logistic regression approaches, we find that housing expenditures were fairly stable in the U.S. and Israel, while food and credit card payment expenditures were relatively volatile. We also find that skipped utility bill payments were much higher in the US than Israel, while rates of skipping housing payments and food insecurity were similar between the two countries. Generally speaking, racial/ethnic/religious minorities in both countries were more likely to experience spending volatility, while Black and Hispanic (in the US) and Arab (in Israel) households were more likely to experience hardships. Employment and financial characteristics also appeared much more predictive of hardship in the US than in Israel.