Wednesday, May 7, 2008

As the Economy Worsens, Consumers´ Buying Behavior Is Changing. How will Immigration Issues Impact the Slowing Economy?

I found this very interesting Newsweek article about the change of Consumers´buying habits. As our economy worsens, consumers continue to buy groceries, health products and gas at any price. They are cutting back on furniture, appliances, fancy restaurants, vacations, clothes and jewelry.
It seems the mood of the nation this summer will be staying at home for family barbecues. Also, it appears Wal-Mart will not be impacted by the downturn in the economy.
My Question to my readers is, will you be affected? Do you think the Immigration issues will impact the Slowing Economy?
As Goes Wal-Mart, So Goes the Nation
For a better understanding of our budget consciousness, check out the world's largest retailer.
By Jennifer Barrett Newsweek Web Exclusive May 7, 2008

No matter how bad the economy gets this year, Americans aren't about to stop buying groceries or gas. But as fuel tops $4 a gallon and the costs of basics like bread and milk rise, consumers are learning to economize. How? For a clear view of our readjusted shopping habits, head to Wal-Mart. With an average of more than 100 million customers a week, the world's largest retailer offers a telling glimpse of how consumers are responding to the economic downturn. Not surprisingly, the company has largely benefited from the increase in budget-consciousness: it reported record sales of more than $106 billion for the quarter that ended Jan. 31, the majority of that coming from its domestic stores. What's hot and not? During a presentation to analysts last week, Eduardo Castro-Wright, CEO of Wal-Mart's U.S. stores, pointed to strong sales in groceries, health and wellness products, as well as flat-screen televisions and other consumer electronics. Clothing and furniture, however, are not selling well.
Apparently, new wardrobes and home-decorating projects are giving way to economic woes. Recently, the Labor Department said clothing prices nationwide fell by 1.3 percent in March, the largest monthly drop in nearly a decade. Recent markdowns, say analysts, haven't done much to move clothes off the racks or furniture off the showroom floors. Furniture stores have reported slower sales in the first quarter of the year. "

7 comments:

Dee said...

In addition to Food, meds and Gas, I think the other item consumers will keep are their cellphones, then cable.

They may stop buying clothes, furniture. They may stop going to high end restaurants and shops.

This tells me the next group to lose jobs are those that work in restaurants and those in sales. That is middle America.

If food continues then migrant labor will continue. There will be no change. And, if these are jobs Americans wont do (as has been proven in MI with the layoff of auto workers) then migrant labor continues.

Those impacted by this recession are middle class. What happens next are more layoffs or terminations. That means these employees will apply for unemployment. Congress is already anticipating the increase in unemployment and currently has a bill in progress which will extend unemployment benefits for 13 weeks.

extend benefits
Extending unemployment benefits for workers whose benefits have run out by up to 13 weeks nationwide and an additional 13 weeks in states with unemployment rates of 6 percent or greater, including Michigan, Alaska and California. Cost: $11.1 billion over 10 years.

dianne said...

People will cut back on everything they can, especially anything that involves fuel that isn't absolutely necessary. Can you imagine if gas goes to $10.00/gal? Holy cow. But, of course, the dems say no to drilling our own fields in Anwar, no to nuclear power plants, so what do they expect. You reap what you sew.

The only impact I see on illegal immigration is people are going to be competing for jobs as unemployment rises which it is sure to do. And, there could be even more resentment in areas like construction which is especially hard hit. 20 million illegal immigrants aren't working in agriculture. Most of them are working in construction, in factories, in restaurants (where even there you can make good tips), and other jobs that pay enough to make a decent living.

patriot said...

dee, you must think we have a short memory so therefore you are now trying to imply that the Michigan auto workers wouldn't do any manual labor jobs. The only jobs they wouldn't do is pick crops and that is because the auto workers can't live on that kind of wage and they live mostly in the city where there are no crops to pick. You simply amaze me with your little white lies in here.

patriot said...

dianne, you are correct. There are only about 2% of illegal aliens picking crops. The rest of them are taking jobs that Americans will do.

Dee said...

Dianne, You are right. The restaurant industry will be hard hit and we know many of them employ both immigrants and illegal immigrants. On the other hand, if the restaurants go out of business, no one will be employed and only the legal citizens will be able to claim unemployment benefits.
The Immigration Dept says the rate of new illegal immigrants has significantly decreased, so this will have impacts for those illegal immigrants that have been here for a while and may be embedded into the community.

Dee said...

I also think the Travel industry will be hit very hard during this recession. I dont believe many illegal immigrants are employed in the airline industry (airlines, airport security, etc.) The pilots, stewardesses, etc may face more layoffs.

Liquidmicro said...

Globalization means that soon, we, too, might be working for pennies an hour. It’s like Adam Smith in reverse: trade with people less free than you, and your own freedom is threatened.

Disposable People

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