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Shutdown leaves impact on holiday shoppers
Reflected in plans to spend less this year
Question of the Day
Half of American shoppers said the federal government’s inability to address its financial woes was a factor in scaled-down holiday spending plans this year, according to a recent survey.
The Consumer Federation of America and the Credit Union National Association’s annual consumer survey, released Wednesday, showed effects of the federal government shutdown are still being felt.
“The survey suggests that the government shutdown and related budget controversies have tended to depress spending,” said the CFA’s Steve Brobeck.
“The good news is that there’s been a continued increase in the percentage who say they’ll spend more and a decrease in the percentage who say they’ll spend less,” said Mr. Brobeck.
In the survey, conducted two weeks ago, 14 percent of Americans said they plan to spend more than last year, an increase of 6 percent from 2011, the last year the study was conducted.
In that 2011 survey, 41 percent said they planned to spend less. This year, that figure was down to 32 percent.
Mr. Brobeck and Bill Hampel of the Credit Union National Association also predict that holiday spending this year will increase by 3.5 percent more than last year’s results.
Still, one significant negative finding from the survey is that it further proves “the uneven effects of the economic recovery,” said Mr. Brobeck.
The survey found that households with incomes under $50,000 were much more likely than those over $100,000 to say their financial situation had worsened.
According to the survey, two-fifths of those with incomes under $50,000 said they plan to spend less than last year, and a quarter of those surveyed said they plan to spend much less.
Mr. Brobeck believes that this is primarily because Americans with lower incomes are more concerned with bills and consumer debt payments.
That kind of strain on the pocketbook also indirectly affects the holiday spirit — at least when it comes to making the annual trek to the mall.
According to a CBS News poll released earlier this month, 42 percent of Americans said they were looking forward to holiday shopping this year, while 50 percent said they were not.
The pressures of holiday shopping can also be particularly high for young adults in college or recently introduced to the workforce.
“Someone who went to a liberal arts college and is working at a coffee shop, of course you expect them to be broke,” said Lauren Lyons Cole, a certified financial planner and financial expert, in an interview with Forbes.
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