NEW YORK, Sept. 12, 2014 /PRNewswire/ -- The Deloitte Consumer Spending Index (Index) picked up in August, which may be a sign of better things to come. The Index tracks consumer cash flow as an indicator of future consumer spendingi.
"A notable decrease in initial unemployment insurance claims helped push the Index up," said Daniel Bachman, Deloitte's senior U.S. economist. "An improving labor market can be a boon to consumer confidence. If these trends continue, there is a strong likelihood that we could see an acceleration of economic growth in the latter part of the year."
The Index, which comprises four components – tax burden, initial unemployment claims, real wages and real home prices – increased to 3.96 this month from 3.70 last month.
"The uptick in the Index suggests optimism as retailers anticipate the all important holiday shopping season," said Alison Paul, vice chairman, Deloitte LLP and retail and distribution sector leader. "These economic fundamentals along with lower gas prices may encourage consumers to pick up their spending in the months ahead. Retailers should take a closer look at inventory with this optimism in mind to get an early read on what's hot – both in store and online, in case they need to pull some last minute levers to replenish merchandise. Retailers should also assess their cyber security levels as attackers may be especially motivated to be more aggressive during peak periods like the holiday season. Retailers will not only need to be vigilant about suspicious activity, but prepared to quickly address and recover from any incidents."
Highlights of the Index include:
Tax Burden: The tax rate continues a steady hold at 11.7 percent, showing a marginal increase from the prior month.
Initial Unemployment Claims: Claims decreased notably this month to 296,000, and furthermore were down 10.5 percent from the same period last year.
Real Wages: Real hourly wages increased slightly to $8.80 this month, a slight 0.3 percent up from the same period last year.
Real Median New Home Price: New home prices continue to fluctuate as they fell 3.8 percent from the prior month to $113,000.
For a historical analysis of Deloitte's Consumer Spending Index compared to real consumer spending, visit: www.deloitte.com/us/retail/consumer-spending-index/Aug2014.
About Deloitte's Retail and Distribution Practice
Deloitte is a leading presence in the retail and distribution industry, providing audit, consulting, risk management, financial advisory and tax services to more than 80 percent of the Fortune 500 retailers. With more than 1,400 professionals, Deloitte's retail and distribution practice provides insights, services and solutions assisting retailers across all major subsectors including apparel, grocery, food and drug, wholesale and distribution and online. For more information about Deloitte's retail and distribution sector, please visit www.deloitte.com/us/retail-distribution.
As used in this document, "Deloitte" means Deloitte LLP and its subsidiaries. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.
i The Deloitte Consumer Spending Index is a proprietary methodology that analyzes economic factors to gauge consumer cash flow as an indicator of future spending. Deloitte's analysis includes data from the U.S. Commerce Department, Bureau of Economic Analysis, U.S. Bureau of the Census, U.S. Department of Housing and Urban Development and the U.S. Department of Labor.
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SOURCE Deloitte
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