To Offset Inflation Impact, Shoppers Skip the Gym to Save Money
Apparently, consumers are dropping gym memberships and carpooling more as they fret over inflationary prices and fears of a recession, according to the latest research from First Insight.
The survey revealed that 62 percent of shoppers polled said they “believe the U.S. is currently in a recession, with a further 17 percent unsure.” And according to the authors of the report titled “The State of Consumer Spending: Inflation Fueling Recession Fears,” rising food prices “are the biggest recessionary concern for 68 percent of consumers, with nearly half (48 percent) also concerned about food shortages.”
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The research was conducted in July. Last week, the Labor Department noted that inflation was up for the year but had flattened out month-to-month. First Insight said in a statement that its report “reveals some profound changes in consumer sentiment and behavior in just three months since First Insight’s April inflation survey was conducted.”
The company said consumer confidence had dropped lower since April, “with now 80 percent of consumers saying they have less confidence to spend, versus 74 percent in April.” And 28 percent of respondents said they are saving less, with 18 percent noting that they are “tapping into existing savings to pay for higher cost of living expenses.”
First Insight said eating out, household goods, housing and health care, as well as education costs “all increased by double digits in terms of their impact on consumers’ daily lives.”
The report found that dining out remains the top discretionary spending reduction for 54 percent of consumers, up 13 percent since April. The survey also showed that 44 percent more consumers “say that they will cut back on gym memberships due to higher prices.” And ride sharing or carpooling jumped 25 percent since April “as one way consumers are spending less at the pumps,” First Insight said.
Consumers are also turning to private label products to offset higher costs. “Thirty-one percent more consumers today are turning away from name brands and purchasing private label or store brand products as a means of saving money,” the report noted.
“As inflation remains at the highest levels seen in the U.S. since 1981, consumers continue to find different ways to afford things,” said Greg Petro, chief executive officer of First Insight. “Putting food on the table remains consumers’ top priority. We are seeing a reallocation of food budgets, with many consumers cutting back on fresh produce and spending less on name-brand products. One bright spot since our April survey is an increase in spending on work-related apparel now that more consumers are returning to in-office work.”
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