James Russo, Vice President, Marketing, Nielsen
With unemployment reaching 25-year highs, it is no surprise that Americans are nervous about their futures. Over the last twelve months, confidence has nosedived as consumers worry about keeping their jobs, paying their mortgages and other bills, and their retirements.
We are on the verge of a potential fundamental shift in how consumers shop and buy that could have ramifications long past economic recovery. They are shopping less and changing the types of products they purchase, such as shifting to store brands and focusing on necessary items such as food and cutting back on luxuries.
At the same time, however, purchasing power is actually increasing for some Americans. Consider the facts:
Combine these facts with a growing sense that we may be seeing the first signs of a bottoming out and many Americans will be well-positioned to resume their spending. However, until the fear and uncertainty about the economy dissipates, it is unlikely that they will feel confident enough to exercise their increased purchasing power. And once they do, there is little doubt that how they spend their money is likely to be very different in how they did so in years past. Nielsen will continue to closely monitor consumer confidence, shopping trends and other factors to enable our consumer product manufacturing and retail clients to deliver value in the short term and innovate in the long term to help ensure continued growth.
|June 08||Feb 09||Change|
|* Retail Gas||$4.06||$1.92||-53%|
|* Food Inflation||215.3||219.7||2%|
|Fed Funds Rates||2%||0%||-200 basis points|
|30 yr fixed Mortgage Rates||6.37%||5.07%||-1.30 pts|
|Unemployment||5.80%||8.10%||- 3.6 million jobs|
|Avg Wkly Earnings||$596.50||$608.3||2%|
|Source: EIA, FOMC, Nielsen Strategic Planner, Bureau of Labor Statistics, cpi|