I was less than pleased to read the morning headlines that consumer spending “plunged 1.2 percent” last month. Apparently this is proof that consumers are “shunning” department stores and malls, the third month of such declines.
I’m not upset at the news per se, but the characterization of this decline as horrible and devestating for our economy is disheartening. I am not inclined to enjoy the prospect of a recession or economic meltdown because I do not enjoy seeing good people out of work or the poor going hungry. But this is also a positive step for our country, if we let it play out.
Nearly everyone will, at some point in their lives, have a financial meltdown. Not necessarily go broke, bankrupt or bust, but most will have a day when they come to realize that their financial situation is less than secure. We realize we own too little real assets (playstation games don’t count), we owe too much or we’ve not saved enough. These meltdowns follow emergency room visits, mr. fluffy’s run in with a bigger, meaner fluffy, the pink plus on the pregnancy test, a job loss and a dozen other circumstances.
Our country just saw the pink plus sign and we’re experiencing labor pains.
We realized, collectively, that we’re overextended on credit, importing more than we export, out of touch with daily necessities and dependent on unstable commodities.
I would have adored, loved, worshipped and proposed to marry the writer and editor who were brave enough to post the following headline:
“Americans cut back on unnecessary spending; secure financial futures”
We need to stop building businesses that rely on overconsumption. Stop demanding and paying for more and more excess. We need to get back to the basics of quality food, quality clothes and quality transportation and away from the sunless tanning, $1.99 drugstore t-shirts and coathanger head scratchers.
This “apocolyptic” sign that we are fleeing the malls and *gasp* saving our money for hard times is encouraging to me.
I do recognize that lower sales may mean minimum wage workers have their hours cut back or jobs eliminated and I’m sympathetic. But I have two theories. First is that if each worker did his or her job with the highest standard of quality fewer labor hours would be required. Full disclosure here, I work a part time job and see this first hand. A good night is two dedicated people who can turn over a large level of inventory, clean and restock shelves in six hours while attending to customers. On a bad night we could have four lazy, unmotivated people working eight hours and get very little accomplished. There will always be workers who are not internally motivated to work hard. Managers must hold their workers accountable.
My second theory is that optimal staffing of these lower wage jobs should propel more workers into better jobs. I know, it doesn’t work this way. But I do wish that we had the national demand for solar power researcher, for teachers with smaller classrooms, for environmentally safe engineering and building.
Let’s talk a little more about this consumer spending crises. Economists point out that spending drops indicate less lending in the credit market. Again, I’m not unhappy.
According to MSNBC, “The weakness was led by a 3.8 percent drop in auto sales. Sales dropped below 1 million units as consumers struggled to find financing.”
This part does make me sad. It’s not that consumers are not making large purchases, like cars, because they’re saving for the future when they can purchase outright. Consumers just can’t get the money to buy what they want right now. And with more Americans upside down on vehicle loans and losing their homes to foreclosure it’s amazing to me that our concern is not securing enough credit to do it all again.
So, despite my hopes for a national awakening, it seems we’re ignoring the elephant in the room.