Section 4 • Economics & Demographics Meanwhile, the Conference Board, a business research group,
reported that consumer confidence tumbled to its lowest level since 2014. The Conference Board said its consumer confidence index, which measures how optimistic consumers feel about the economic outlook, dropped to 84.8 in August, down from 91.7 in July. In August 2019, the index sat at 134.2. While there are many similar surveys, the results of the consumer confidence survey conducted by V can be seen in Table 4.2 on page 41.
Jan 18 Feb 18 Mar 18 Apr 18 May 18 Jun 18 Jul 18
Aug 18 Sep 18 Oct 18 Nov 18 Dec 18 Jan 19 Feb 19 Mar 19 Apr 19 May 19 Jun 19 Jul 19
Aug 19 Sep 19 Oct 19 Nov 19 Dec 19 Jan 20 Feb 20 Mar 20 Apr 20 May 20 Jun 20 Jul 20
Aug 20 Source: Statista 42 Self-Storage Almanac 2021
7.7 8 8
7.7 7.5 7.6 7.5 7.5 7.5 7.3 7.2 8.8 8.5 8.6 8
7.5 7.3 7.1 7
7.3 7.3 7.2 7.5 7.2 7.6 8.3
12.9 33.7 24.5 18.7 17.7 14.1
A McKinsey & Company
survey revealed a positive consumer outlook in August. Optimism about a quick eco- nomic recovery
rebounded
as new COVID-19 cases in the U.S. began to stabilize. Discre- tionary spending, such as for self-storage, was slowly recov- ering, although the survey still showed “negative intent.”
Most Americans continued
to believe that the impact of the crisis on their routines and personal finances would last beyond year-end, according to the survey.
July marked the third
straight month that consumer spending gained speed, ris- ing 1.9 percent over June. The rise in consumer spending, the primary driver of the U.S. econ- omy, represented a measure of support for an economy struggling to emerge from the grip of the pandemic. The Commerce Department also reported that income rose 0.4 percent in July following two months of declines.
The spending report
came as a brief respite amid an economic landscape deal- ing with high unemployment, struggling businesses, and uncertainty about when the health crisis will turn around to the point where people and companies feel confident enough to resume normal spending and hiring.
While millions lost jobs and were forced to unemployment
rolls, Congress passed a $3 trillion relief package in March that included up to $2,400 in stimulus checks that went to many households, in addition to an extra $600 per week of unem- ployment benefits.
It turned out that many Americans salted away the extra
money into bank accounts, driving the personal saving rate to a high of 33.7 percent in April. By July, the saving rate in the United States dropped to 17.8 percent, still significantly higher than 2019’s rate of 7.6 percent, according to Statista, a German company specializing in market and consumer data.
According to Statista, in August 2020, the personal sav-
ing rate in the United States amounted to 14.1 percent, down from that high of 33.7 percent in April. Personal saving rate is calculated as the ratio of personal saving to disposable personal income. Saving refers to strategies of accumulating capital for future use by either not spending a part of one’s income or cutting down on certain costs. Saved money may be preserved as cash, put on a deposit account, or invested in various financial instruments. Investing usually incorpo- rates some level of risk, which means that part of the invested money can be gone. The example of a relatively safe invest- ment would be saving bonds, debt securities issued by the U.S. Department of the Treasury.
The personal saving rate in the United States amounted
to 7.6 percent in 2019, compared to 11 percent in 1960. The personal savings in the United States amounted to approxi- mately $1.3 trillion (USD) in 2019. These figures are likely to be higher in 2020 due to the spike in the savings rate in the first half of the year. People tend to save rather than spend in uncertain times, which explains the savings increase during the COVID-19 pandemic.
The stimulus package helped to push the national debt
to $26.7 trillion, the highest level since World War II, accord- ing to the Treasury Department. To illustrate that sheer size, the Congressional Budget Office reported the federal debt is expected to eclipse the size of the entire U.S. economy, mea- sured in GDP, in 2021.
Will The Economy Turn Around In 2021? The severity of the economic slump precipitated by the pandemic was a matter of debate as fall approached. Many economists predicted a prolonged downturn lasting well into 2021, while statistics showed that recovery may be right around the corner.
A summer survey of the National Association of Business
Economics members showed about half expected the GDP would not return to its pre-pandemic level until 2022. A ma- jority of those experts also said the U.S. job market won’t be back to its early 2020 level until 2022 at the earliest.
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76 |
Page 77 |
Page 78 |
Page 79 |
Page 80 |
Page 81 |
Page 82 |
Page 83 |
Page 84 |
Page 85 |
Page 86 |
Page 87 |
Page 88 |
Page 89 |
Page 90 |
Page 91 |
Page 92 |
Page 93 |
Page 94 |
Page 95 |
Page 96 |
Page 97 |
Page 98 |
Page 99 |
Page 100 |
Page 101 |
Page 102 |
Page 103 |
Page 104 |
Page 105 |
Page 106 |
Page 107 |
Page 108 |
Page 109 |
Page 110 |
Page 111 |
Page 112 |
Page 113 |
Page 114 |
Page 115 |
Page 116 |
Page 117 |
Page 118 |
Page 119 |
Page 120 |
Page 121 |
Page 122 |
Page 123 |
Page 124 |
Page 125 |
Page 126 |
Page 127 |
Page 128 |
Page 129 |
Page 130 |
Page 131 |
Page 132 |
Page 133 |
Page 134 |
Page 135 |
Page 136 |
Page 137 |
Page 138 |
Page 139 |
Page 140 |
Page 141 |
Page 142 |
Page 143 |
Page 144 |
Page 145 |
Page 146 |
Page 147 |
Page 148 |
Page 149 |
Page 150 |
Page 151 |
Page 152
