Black Friday Shoppers Worry About Economy as Retailers Push Sales Prices
NEW YORK (AP) — Many people are cutting back on purchases in response to recession fears as shoppers and retailers grapple with the economic realities of a down economy and a recession as deep as it has been.
Shoppers who plan to spend as much as they did before the recession are cutting back on impulse purchases at home and in stores and are more likely to try to reduce holiday spending for several months from now.
The Commerce Department said Thursday that personal spending in December fell 2.5 percent from September, and consumer confidence fell to its lowest level in seven years.
The Commerce Department also said that while spending has held up at least part-time jobs, the slowdown is deep.
“It’s not a pleasant picture,” said John Ryding, chief economist and head of research at IHS Global Insight in Lexington, Mass. “It’s pretty bad.”
Many consumers are making money-saving trips in search of bargains during the holiday shopping season. That means fewer trips — not necessarily fewer trips to stores. Many may instead make fewer visits to department stores.
“A lot of people are using the time off to be savings instead of spending,” said David Tjeenk outweigh, a retail analyst for Bloomberg Industries and a contributing editor to Retailers’ Monthly magazine.
Some shoppers are even using the holidays as an opportunity to buy some last-minute presents at stores while others avoid buying for at least the next two months.
“Holiday season is the most challenging time of year for retailers,” said Bill McManus, vice president of research at the National Retail Federation. “Retailers feel more pressure than ever from customers who are going out of their way to avoid buying things they’re not going to use.”
A few stores can expect their annual performance to drop to the bottom of their industry by next year’s fiscal year, when the government will collect data on the industry. The decline will be temporary or minimal, because “the holiday season will return,” said Richard Greenfield, director of the University of Michigan’s Retail Trade Center.
“I wouldn’t expect this to be a huge recession. This would be a slow one