I was recently reading the newspaper at my grandma’s house, which I don’t normally do as news can be so abysmal, but an article managed to catch my eye. It was about how Macy’s reported earnings were rather weak this quarter, and how other stores have been following suit. I found this article on CBS News that talked about the topic more in-depth, and the trends of consumer spending so far this year.
Why consumers aren’t spending like they used to
The argument is that the average American hasn’t been spending as much as before due to low pay or lack of raises, the payroll tax reinstated during the beginning of this year, and job stability still being an issue. These are all plausible reasons as I’ve been experiencing them myself. Though I am quite frugal by nature, my main focus has been to pay off my student loans and not spend frivolously, so I am not compelled to splurge on anything lately. I allow very little in the way of discretionary spending, and most of it is in little splurges. If others are following this mindset, it is easy to understand why there haven’t been as many purchases involving bigger-ticket items such as televisions and other electronic gadgets since they are simply not in the “budget.” I would also rather wait until these items go on sale – big time – and according to Lifehacker, the best time to purchase “televisions & electronics” is in November and December.