Official US indicators for employment, inflation and GDP may seem badly out-of-date as the rapidly spreading coronavirus outbreak wreaks havoc on the economy, as the Key data points are often a month behind.
To give a more timely look, below are 5 Key indicators tracking how consumers are reacting to the crisis.
Consumer spending makes up 72% of the economy, so any suspension can hammer growth, or cause a contraction, as economists see as a growing risk.
Some sectors are already seeing all activity Stop, as follows:
US hotel occupancy fell to 61.8% in the week ended 7 March, from 66.6% a year earlier on drops across hard-hit states like California, New York and Washington, according to industry tracker STR. In Seattle, which had the 1st big US outbreak, the occupancy rate fell to 52.3%, the lowest among the Top 25 markets. Rooms also emptied out in Southern California’s Anaheim-Santa Ana area around Disneyland, which closed from Saturday.
Personal spending on lodging equals 0.8% of GDP, the US Commerce Department data show. Those expenditures could plunge by 50% if the 9/11 terrorist attacks are any guide, according to Renaissance Macro Research.
The White House is considering measures to help the country’s hard-hit tourism industry including offering more support to hotels, as well as airlines and travel firms.
2. Retail sales
The weekly retail sales report continues to be a bright spot showing consumers are still shopping, though they have shifted some purchases to emergency supplies in response to the outbreak.
Month-to-date sales in the week ended 7 March rose 6%. That reflected a big increase in sales at discount stores, while department stores suffered declines. Sales were led by pharmaceuticals, cleaning products, household supplies, consumables, bottled water and food the report noted.
3. Box Office
The cinema industry, from the biggest chains to independent owners, are reducing capacity as part of the fight against coronavirus.
AMC Entertainment Holdings Inc., the market leader, said Friday that it would cut in half the number of tickets it sells for each showing, going beyond what is required in places with restrictions on gatherings, such as New York, California and Washington.
While many are avoiding crowds as public health officials advise, the appeal of the movies matters too in drawing an audience.
Studios are pushing back some major releases, such as the James Bond feature “No Time to Die” and Disney’s “Mulan,” a move likely to keep movie theater seats emptier for longer.
4. Broadway Tickets
New York Governor Andrew Cuomo closed Broadway theaters Thursday and banned large gatherings to slow the spread of the virus. Performances will be suspended through 12 April, according to the Broadway League. In the week ended 8 March, Broadway attendance was down 6.5% from a year earlier, the group said.
The closure of theaters reflects a broader halt to cultural attractions. New York’s Metropolitan Museum, Carnegie Hall, and Met Opera have shut their doors, in addition other such shuttered sites nationwide.
5. Consumer comfort
US consumer confidence deteriorated for a 6th week running, the longest such stretch since Y 2015, according to the Consumer Comfort index. The measure of how consumers view their personal finances took a hit following the plunge in stock prices. Yet consumers are persevering and confidence remains at elevated levels compared with the last recession.
The virus has not generated an “economic panic” similar to the run-up to the Ys 2007-2009 recession. Additional declines in confidence seem likely as we have seen in the preliminary MSI report. The March reading for the University of Michigan’s Index of Consumer Sentiment showed a drop to 95.9 (consensus 96.0) from the final reading of 101.0 for February.