Economic policy uncertainty soured sentiment in 2025, but despite the headwinds, the economy is beginning to accelerate slightly as we look toward 2026. Growth has been uneven, with high-tech and essential services as relative winners. Disparate outcomes will carry into 2026, with overall growth being mild to moderate. The eyecare industry is relatively well-positioned, having a core of nondiscretionary demand and demographic factors in its favor.
In the 12 months through August, personal consumption expenditures for eyeglasses and contact lenses in the U.S. were 4.5% above the same period one year ago. Growth this year has been primarily driven by price with relatively flat volumes.
Looking forward to 2026, here are some key economic trends that will impact the eyecare industry and how you can plan for them.
Inflationary Pressures
Pricing pressures are mounting in an accelerating trend that will extend through 2026. Tariffs and a tight labor pool are contributing factors, but the deeper causes are prior monetary policy and current fiscal policy. Plan for higher costs coming from multiple vectors. Consider making investments to improve efficiency and negotiating with suppliers or seeking alternate sources.
High-End Focus
Consumers are stable overall, but middle- and upper-income consumers will drive the bulk of growth.Employment is at record highs, incomes are rising, and consumers have room to take on more debt. We could also see some positive wealth effects from elevated home prices and stock valuations. However, lower-income brackets are feeling real strain, with essentials taking up an increasing amount of their budgets. Consider targeting the luxury and higher-end market.
Essential Services
Discretionary segments are more at risk this cycle than essential goods. Eyecare services will have some insulation from this, given a portion of demand is essential and insurance covers some costs. However, consumers are price-conscious, so expect some lingering softness in demand for nonessential vision procedures or purchases at optometrists’ offices. Some consumers may wait to upgrade their eyeglasses or look for the lower-cost options, which may be online. Practices can benefit from offering flexible pricing options, promoting services covered by insurance, and highlighting the long-term health benefits of regular eye exams. Communicate your competitive advantages over the competition.
Long-Term Investments
Some short-term interest rate cuts are possible, but long-term interest rates will remain sticky. The Federal Reserve cut their target overnight rate in September, but rising inflation will likely limit their ability to justify material cuts in the coming year. Keep in mind that interest rates on longer-term loans are set by the market and involve more risks, so they tend to be stickier. If you are considering borrowing to fund investments in your business, don’t try and time a low in rates. Instead, focus on the ROI and aim for an expected payback period ahead of the 2030s. Investments in long-term efficiency are advisable.
Tight Labor Market
About Brian Beaulieu
Brian Beaulieu is the chief economist and founding principal with ITR Economics. Over the past 40 years, he has delivered his research findings through presentations, workshops, and seminars across various countries.
The labor market remains fundamentally tight due to a combination of aging demographics and immigration policy. Annual employment in optometrists offices is up by 2.9%, slightly stronger than national trends at 1.1%. While employment is at record levels, confidence in the job market has softened, so we are seeing fewer employees voluntarily quitting. As confidence improves later in 2026, we could see more employee turnover, and as inflation picks up, we may see demand for a higher wage increase in coming years. Look for ways to boost efficiency through technology while being mindful to keep morale high. Make sure you know how your benefits package stacks up relative to your local area.
Don’t let the fear-mongering headlines of 2025 cloud your plans for 2026. While there are still challenges to plan for, the macroeconomic backdrop will be one of gradual improvement in the year ahead; consumers will be able to spend more but will remain cost-conscious. Invest in your business, with an emphasis on efficiency to protect your future margins.