America’s working families are our customers. Teachers teach our children in schools, construction workers build our homes, and medical workers treat us,” Rosen said in an interview last week. The economic environment is tougher for that customer.”

Inflation has snowballed on family budgets, according to JCPenney’s CEO, with the typical household spending about $700 more a month than two years ago.

Having to make tradeoffs in everything they can do is tough for a family like that, Rosen said.

This financial stress is reflected in the “very strong” growth of the department store’s private brands, which are cheaper than national brands. He highlighted strong private brand sales for apparel and home goods such as cookware and small appliances such as blenders and toasters. Rosen added that while JCPenney maintains a “strong” portfolio of company-branded credit cards for its customers, credit usage has increased and delinquencies are back at levels seen before Covid-19.

This is in line with what other retailers have said. Similarly, the New York Federal Reserve reported that the rate of new credit card delinquencies has risen above mid-2019 levels, as did rival Macy’s.

According to JCPenney, the US economy is in a confused state. Although the risk of recession has decreased and the jobs market remains strong, some consumers are suffering.

Dollar General cut its sales and profit expectations last week, citing “financially constrained” customers. Bank of America reported recently that Americans are tapping their 401(k) accounts for cash.