Layoff Concerns Rise to 41%; Consumers Turn More Cautious: Kantar Study

For years, India's consumption story was powered by optimism.

Consumers borrowed against tomorrow's income. They upgraded smartphones, booked vacations, financed vehicles and spent freely on experiences. Economic uncertainty existed, but it rarely altered the broader belief that the future would be better than the present.

That confidence is beginning to crack.

The latest wave of Kantar's State of the Nation study suggests Indian consumers have not become pessimistic. But they have become defensive.

The shift is subtle yet significant. People are not abandoning consumption. They are recalibrating it.

The first wave of the study, conducted in January 2026 ahead of the Union Budget, captured a consumer balancing hope with caution. By May, after months marked by geopolitical tensions, fears of a global slowdown and growing concerns around employment, that balance had tilted further towards caution.

Only 48% of consumers now expect India's economy to improve in 2026, down sharply from 60% in January. Concerns about layoffs have risen from 36% to 41%.

The numbers tell a larger story than economic sentiment alone.

They suggest Indian consumers are beginning to view uncertainty not as a temporary disruption but as a structural reality.

That shift becomes even more visible when examining personal finances.

Nearly two-thirds of respondents said they expect their savings and investments to either remain stagnant or decline this year. Just 39% believe their financial assets will grow.

Normally, weaker confidence translates into weaker savings. This time, the opposite is happening.

Consumers may feel less confident about the future, but they are trying harder to prepare for it.

Almost 63% said they were very likely to increase savings for themselves and their families. Future financial preparedness has emerged as one of the strongest themes across the study.

Retirement anxiety is no longer confined to older generations. Nearly eight in ten respondents expressed concern about having enough money for retirement, with consumers aged between 36 and 45 reporting the highest levels of worry.

Healthcare remains the single biggest financial concern, cited by 85% of respondents. Rising living costs worried 80%, while 71% expressed concerns about managing rent and loan repayments.

Taken together, these concerns reveal a consumer increasingly preoccupied with resilience rather than aspiration.

This is not necessarily bad news for brands.

What is changing is not the desire to spend but the conditions under which consumers are willing to do so.

Across discretionary categories, spending intentions weakened. The proportion of consumers planning to increase spending on dining out, entertainment, shopping and subscriptions fell from 55% in January to 53% in May. Those intending to reduce such spending rose from 8% to 10%.

The trend was even more visible in high-ticket purchases. Consumers planning to increase spending on expensive items declined from 46% to 44%, while those intending to reduce spending jumped from 11% to 16%.

Inflation remains the dominant driver behind these decisions, cited by 65% of respondents. However, inflation is no longer acting alone.

Almost half of consumers said they wanted to save more. Economic uncertainty and concerns around investment returns were also shaping spending behaviour.

The result is a more calculated consumer.

Forty-four percent are actively trying to reduce electricity and fuel expenses. Forty-two percent are eating out less and cooking more at home. Forty-one percent are cutting subscription costs, while 39% are delaying purchases until sales events and actively hunting for discounts.

Commenting on the findings, Deepender Rana, Executive Managing Director, South Asia, Kantar says: “Our latest report shows that Indian consumers remain resilient but are becoming noticeably more cautious as economic and geopolitical uncertainty rises. Confidence in future financial growth has softened, while concerns around job security, retirement preparedness and rising living costs have intensified. As a result, consumers are becoming more deliberate in how they spend- prioritising savings, value and long-term financial security, while continuing to protect experiences that enhance their wellbeing and quality of life. For brands, this presents a clear imperative: demonstrate tangible value, build trust and relevance and deliver meaningful benefits that help consumers navigate uncertainty with greater confidence.”

For marketers, this represents a profound shift.

Consumers are not asking whether they should spend. They are asking whether a purchase deserves to be made.

The distinction matters.

In previous slowdowns, brands often responded by pushing discounts. Today's consumer appears to be evaluating value more deeply. Utility, durability and long-term relevance increasingly matter as much as price.

This also explains why one category continues to enjoy remarkable resilience: gold.

More than half of respondents said they were very likely to buy gold over the next year.

Gold's appeal has never been purely financial. It represents certainty in uncertain times. When confidence in future income weakens, assets perceived as safe tend to gain emotional as well as economic value.

Yet perhaps the most surprising finding in Kantar's study is what consumers refuse to cut back on.

Experiences.

Despite growing financial caution, 60% of respondents still intend to take a domestic holiday over the next 12 months. More than half plan to travel internationally. The same proportion expressed willingness to spend on once-in-a-lifetime experiences.

At first glance, the contradiction appears puzzling.

Why would consumers reduce restaurant visits and subscriptions while planning international holidays?

The answer lies in how people increasingly define value.

Experiences are no longer viewed as discretionary indulgences. They are increasingly seen as investments in wellbeing, memory-making and personal fulfilment.

In a world that feels more uncertain, experiences offer something financial assets cannot: immediate emotional returns.

The emerging Indian consumer, therefore, is neither fearful nor carefree.

They are becoming selective.

They will save more aggressively, scrutinise purchases more carefully and seek stronger justification for everyday spending. But they will continue to spend on what they believe genuinely enriches their lives.

That may be the most important takeaway from Kantar's latest findings.

The story is not that confidence is falling.

The story is that confidence is being replaced by caution, and caution is reshaping consumption in ways that could define India's next phase of economic growth.