K-shaped economy is 'alive and well,' expert says — what new research shows

The so-called K-shaped economy is becoming more pronounced, new data shows.

In the aftermath of the Covid pandemic, the K has been used to illustrate Americans’ diverging economic experiences: Higher-income households are increasingly better off, while lower-income households are falling further behind.

A new report by credit reporting bureau TransUnion found that while credit conditions have improved for a large segment of consumers, others are struggling in the face of higher costs and rising debt burdens.

The K-shaped economy is “alive and well,” said Michele Raneri, TransUnion’s vice president and head of U.S. research and consulting.

Over the past several years, more borrowers have become either superprime, with a credit score of 780 or higher, or subprime, with a credit score below 600, according to TransUnion. The dynamic is creating an increasingly bifurcated consumer economy.