The latest consumer spending survey from Deloitte finds that Americans have factored in their higher payroll taxes and found they can open their wallets and do a little spending – in fact, Deloitte suggests were it not for sequester uncertainty, an economic turnaround might possibly be at hand.
Deloitte’s February Consumer Spending Index edged upward on the strength of a decline in initial unemployment claims and an increase in earnings, which were enough to offset other negatives. The Index rose from 3.9 in January to 4.0.
Report author Patricia Buckley commented, “Financial institutions and the markets are stronger, and consumer confidence and real spending appear to be weathering the 2013 payroll tax increases fairly well. Absent the uncertainty surrounding the impact of the sequester, an economic turnaround would likely be imminent.”
Added Deloitte vice chair Alison Paul, “The Index along with other positive retail news demonstrates that retailers have been able to focus consumers on spring – Easter entertaining, warm-weather apparel and home improvement projects. Keeping that momentum will take more than just traditional seasonal signage and promotions. Highlighting new and unique merchandise – both in store and on web sites while fully integrating with mobile apps – can continue to drive traffic and encourage full-price purchases, inspiring consumers to spend their tax refunds.”