As the COVID-19 Crisis Continues, Retail Takes a Devastating Dive

Illustration for article titled As the COVID-19 Crisis Continues, Retail Takes a Devastating Dive
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As we measure the ongoing effects of COVID-19, loss of life and public health should remain chief among our concerns—despite any GOP rhetoric to the contrary. But America’s economic health is also in jeopardy, as evidenced by what the New York Times writes are “a number of reports that highlight just how badly the economy is faring.”

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The S&P 500 dropped more than 2 percent in early trading Wednesday morning; damning news the Times largely credits to the Commerce Department’s report that retail sales in March saw a drop of 8.7 percent—setting a record for the most dramatic decline in the three decades the retail industry has been monitored. In case you’re wondering, this drop not only includes purchases made in stores but also online, as well as car purchases (and gas, since a large segment of the U.S. population, is currently housebound). Additionally, it includes funds that would normally be allocated to recreation; those customarily spent at bars and restaurants. The report reflects a seasonally adjusted decline from February’s numbers—which were, of course, garnered prior to the stay-at-home orders forcing most would-be consumers to, well, stay at home.

Frankly, this is news to us, since we feel like we’ve been online stress-shopping more than usual—and not just for the requisite hauls of groceries and household goods, sectors which have experienced an expected surge during the pandemic. (And please don’t judge us; everyone has their own coping mechanisms—speaking of which, where is my stimulus check?)

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But as the Times ominously reports, “Until now, the largest one-month downturn in retail sales came in the fall of 2008, when the financial crisis led spending to fall nearly 4 percent for two straight months.”

The cause for concern is also evident in dwindling “industrial production and manufacturing output,” which the Federal Reserve says haven’t decreased by this much since 1946. And the current outlook is even grimmer, as the Times reminds us that “most states didn’t issue shutdown orders to nonessential businesses until late March or early April, meaning data for the current month could be worse still.”

So while yes, the inclination to hoard money during this time in anticipation is an entirely justified and wholly responsible thing to do, for those of us currently lucky enough to be able to afford to keep up our regular spending habits, perhaps doing so isn’t entirely reckless, after all. (Especially if you’re helping to keep black businesses afloat—though, seriously; save more money than you spend. You may very well need it, and sooner than later.) As an economic downturn is now very much a reality, at the very least, you can reframe your retail habit as a form of public service.

Maiysha Kai is Managing Editor of The Glow Up, co-host of The Root Presents: It's Lit! podcast, and your average Grammy-nominated goddess next door...May I borrow some sugar?

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DISCUSSION

fiveliters1
FiveLiters1

This is so true. I was just thinking about how I had a routine of Fridays doing happy hour with friends, going to dinner afterwards, repeating on Saturdays and some Sundays. Driving to the gym or to visit my mom. And now that I’m not doing any of that,I have extra money (and that stimulus check hit yesterday, on top of it!). Going to pay off my one credit card and see how things go after that before I consider shopping though.