By Cathy Yen
The government's recent economic data showed "sluggish" retail sales in July. This data describes consumer spending in brick-and-mortar retail stores and restaurants. Although online spending increased slightly, traditional spending was down for the first time in three months. Economists are concerned that this presages a slower fall than expected.
These numbers cannot possibly include spending from families sending their kids to college.
We are sending two off to school, one to an off-campus apartment and one to a traditional freshmen dormitory. Their respective purchases of must-have items from lists supplied by the schools each resulted in credit card fraud alerts. Both bought enough to have two separate credit card companies put holds on their accounts, citing unusual and sizable spending.
And, we're not finished. The apartment-dweller moved in this weekend, eliciting not one, but two separate trips to Target to augment the two car loads of purchases we brought with us. The dorm-dweller leaves in a few weeks. Thus far, we only purchased what we can stuff into three suitcases. I am sure there will be more than a few trips to big boxes once we arrive in Rhode Island.
This leads to three observations. First, macro-economic trends in consumer spending habits don't seem to reflect the college experience. We've seen this before, in studies that demonstrate how the expense of higher education rises seemingly independently of other economic indicators. And, once you've committed to tuition and books, you have committed to the laptop, the comforter, the extra-long sheets and the electric tea-kettle that works just as well for ramen as instant hot cocoa.
Second, there must be equity issues here. I cannot imagine how a struggling family manages. And I do not believe that institutional financial aid covers the move-in purchases.
Finally, other than the odd note book, most of our purchases were not made locally. Not only did our disposable income go outside our community, but we spent so much that we will be tightening the purse strings to recover.
Maybe that explains the anticipated sluggish retail sales. The few of us out shopping spent everything on college.
Answer Book 2019
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