More than 40% of adults plan to cut back on discretionary spending
According to Bloomberg News, the road to economic recovery is littered with consumer concerns. Despite the dire warnings sounded by the business community – 60 percent of small businesses say they will need to close permanently if revenues do not return to normal by the end of the year – concerns over public health and the anemic economic landscape are discouraging discretionary spending. According to the report:
“More than 40% of people who spent money on movies, event tickets or at bars before the pandemic now plan to spend less on those activities…The planned cutbacks may compound the already massive economic impact of the virus. As cases spiked this spring, states shut down or restricted may [sic] businesses, such as salons and restaurants. Sports leagues postponed their seasons and concerts were cancelled. The unemployment rate remains above 10% and many of the virus-related layoffs that once appeared temporary are becoming permanent.”
This dark economic picture echos reports America’s Recovery Fund Coalition (ARFC) released over the last two months, including analyses showing personal consumption expenditures in a deep hole and countless small businesses on the verge of collapse.
ARFC also released an infographic illustrating the potential for a deflationary cycle if Congress does not act aggressively to shore up American enterprise.