58% of French Consumers Are Reducing Nonessential Spending

French consumers are cutting back on restaurant meals, leisure spending and other non-essential purchases as inflation, energy costs and political uncertainty weigh on household budgets ahead of next year’s presidential election, according to business owners, survey data and economists.

In Paris, restaurateur David Zenouda said the shift is visible at the table. Customers are more often sharing starters, ordering only a main course, or skipping wine at lunch. He said one recent pair of diners split an entrecôte steak to save money. “The purchasing power is really limited,” he said, adding that the café terraces still drawing strong crowds tend to be the ones offering 4-euro pints of beer.

The pullback matters beyond the restaurant trade. Household consumption accounts for about half of France’s gross domestic product and value-added tax is the government’s single largest source of revenue. When consumers spend less, it weakens growth and also complicates the state’s efforts to assemble a workable 2027 budget in a divided parliament, where the last two governments fell.

The slowdown is also being watched closely by the drinks industry. If diners continue to skip wine at lunch or trade down when eating out, that could reduce volumes, table turnover and margins in the hospitality channel for wine, beer and spirits, especially in a market where on-premise consumption remains important.

A September survey by consumer credit company Cofidis found that 60% of French respondents believe inflation is speeding up, while 58% said they are reducing non-essential spending and 54% said they are paying closer attention to prices. More than half said they expect their purchasing power to worsen over the next year, an increase of 10 percentage points from the same period a year earlier.

Mathieu Escarpit, marketing director at Cofidis France, said several factors are feeding that anxiety. He pointed to war in the Middle East, a severe summer heatwave and wildfires, an approaching election, and the refinancing of France’s large public debt. “The backdrop is not very reassuring,” he said.

For economists and retail executives, that mood poses a risk at a time when the French economy is struggling to regain momentum. Dominique Schelcher, the head of grocery chain Systeme U, said last week that households were in “entrenchment mode” as the election approaches. Economist Mathieu Plane of the French Institute for Economic Research said higher oil prices and weak wage growth are eroding what remains of consumers’ spending power.

Escarpit said consumers are looking for savings across daily life and larger discretionary purchases. They are reconsidering vacations, canceling weekend trips by car, reducing leisure spending, eating out less, buying fewer clothes and limiting fuel expenses.

Some sectors are already reporting weaker demand. Clothing retailers said summer sales were poor, with revenue down more than 5% from a year earlier despite the government’s decision to extend the official sale period by an extra week, according to the Fédération Nationale de l’Habillement, an industry group.

Recent economic data show why business leaders are worried. France narrowly avoided recession earlier this year. The economy was flat in the second quarter after shrinking 0.2% in the previous three months, according to national statistics agency INSEE. That left France performing worse than other large European economies such as Germany and Italy.

A 0.3% rebound in consumer spending helped keep France out of recession, but the details were less encouraging. Households supported spending partly by drawing down savings, which still remain above pre-pandemic levels. After adjusting for inflation, disposable household income, a key measure of purchasing power, fell 0.5% in the second quarter. Over the same period, the household savings rate fell to 17.2% from 17.9%.

That combination suggests many families are maintaining spending only by using financial buffers rather than benefiting from stronger income growth. Economists say that is not a durable base for recovery, particularly if fuel and energy prices remain high and if political uncertainty deepens.

Purchasing power is now becoming a central issue in the presidential campaign, with the first round scheduled for April 18 and the runoff for May 2. The issue was also decisive in the 2024 legislative election, when the far-right National Rally won a record number of seats on a platform focused on the cost of living and immigration.

Schelcher said political uncertainty is itself causing some households to spend less. Consumers, he said on France Inter radio, are already setting money aside because they do not know what tax policies the next president may adopt.

The leading candidates are offering different responses, though economists say France’s room to maneuver is limited because of pressure on the public finances. Marine Le Pen of the National Rally, who is leading in opinion polls, wants to cut value-added tax on energy. Hard-left candidate Jean-Luc Melenchon has called on companies to raise wages to prevent a consumer-led recession. Center-right candidates Gabriel Attal and Edouard Philippe both favor reducing the tax burden on the middle class by lowering payroll welfare contributions.

Plane said those proposals face a hard fiscal reality. “There is no longer really any scope for action on the purchasing power front as the state doesn’t have the means to support households,” he said.

That leaves businesses exposed to the choices consumers are already making in shops, at gas stations and in restaurants. In a country where meals out and daytime wine service are part of everyday commercial life, even small changes in ordering habits can be an early sign of broader stress in demand. For now, those signs are becoming harder to miss across the French economy.