Thursday, December 03, 2020

Americans Pull Back on Spending

This year's Black Friday is being called Bleak Friday by some retail analysts, with brick and mortar stores relatively empty and holiday sales below expectations. The number of Black Friday shoppers at retail stores this year was 37 percent below the 2019 level, and holiday spending from Thanksgiving through Cyber Monday was 14 percent lower than last year, according to reporting by the Wall Street Journal

This underwhelming start to the holiday season was predicted by the Census Bureau's Household Pulse Survey fielded in the weeks leading up to Thanksgiving (November 11-23). The survey asked Americans aged 18 or older whether their household spending/shopping behavior had changed in the past seven days. With Covid surging across the country, only 19 percent of the public said they had not changed the way they shopped. Here are some of changes in the shopping behavior of the 81 percent majority...

Changes to spending/shopping behavior in past seven days 
Made more purchases online: 53%
Made more purchases by curbside pickup: 27%
Made more purchases in-store: 8%

Increased use of credit cards or smartphone apps for purchases: 39%
Increased use of cash instead of credit cards or smartphones for purchases: 5%

Avoided eating at restaurants: 58%
Resumed eating at restaurants: 7%

The resurgence of coronavirus could not be happening at a worse time. Holiday spending, on which many businesses depend for the bulk of their revenue, is being constrained by the public's fear of Covid-19. 

Source: Census Bureau, Household Pulse Survey Week 19 (November 11–November 23)

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