A wide variety of economic surveys, taken from a variety of angles, have been showing a moderate upward trend, and we can now add the Deloitte Consumer Spending Index to the list. Three of the four indicators it watches improved in May.
The Index rose from 4.12 in April to 4.27 in May, which was deemed a slight improvement. Of the four indicators, the tax burden facing consumers stood out as non-positive, but just missed the mark. It was flat. Showing improvement: higher home prices, fewer initial unemployment claims and improved real wages.
There was a downer to the tax burden element, which was up 2.2% YOY.
“Three out of the four components of the Index contributed to an uptick in May and have stayed on a moderate and steady track of improvement over the past several months,” said Daniel Bachman, Deloitte’s senior U.S. economist. “The labor market has stabilized, and initial unemployment claims fell nearly six percent since this time last year, while real home prices continued to climb and real wages crept up.”
“Mother nature – rather than the economy or consumers – dealt retailers a wild card this spring,” said Alison Paul, vice chairman, Deloitte LLP and retail & distribution sector leader. “Retailers should take a cue from the past year’s weather as a reminder of the many volatile and unforeseen factors that may affect their sales. Predictive modeling and scenario planning can help retailers prepare for potential business disruptions, which can have a profound impact as they head into their busy and profitable back-to-school and holiday seasons.”
RBR-TVBR observation: Can you say snowball effect? The good news is that the latest surveys have been pointing up. The bad news is that the angle of the arrow isn’t particularly acute – this arrow is close to horizontal, for example. So the snowball is very little at the moment. But each positive development increases its chances of picking up speed and adding mass.
We have a bridge in our neck of the woods that sorely needs replacing. We sincerely wish that they’d get on with it before it becomes the next national infrastructure tragedy on the one hand, and so that the private sector businesses will get contracts, local citizens will get jobs, and will spend their new income with all of the rest of us. Perhaps you have a similar need in your neck of the woods.
MEDIA, MARKETS & MONEY
