Some members of San Francisco’s creative class are taking advantages of bargain prices being produced by the crisis, according to this San Francisco Chronicle report.
For the younger employed set who lack crushing debt, mortgages or families to support, the recession has a silver lining: Previously out-of-reach items are suddenly affordable. As consumer prices fell 1.7 percent in November, the biggest monthly drop on record, some have decided to take advantage of the deals – though not without caution …
“In a year where we would have expected the consumer to say ‘no’ to spending, this younger generation – the young adults who have not had to divert all of their discretionary spending to other family members – continues to self-indulge,” said NPD Market Research Chief Analyst Marshal Cohen. “It’s not a new concept,” Cohen added, noting that “mobile young adult consumers” have always wielded buying power. “It’s just a surprise that people are doing it when they are told not to.”
Cynthia Jaspar, a consumer spending expert at the University of Wisconsin-Madison, said that although young people are vulnerable to job loss in a recession, they will continue to be an important retail sector. Indeed, both the Wall Street Journal and Forbes magazine have reported on the youth-driven bright spots in retail: American Apparel, Urban Outfitters and Buckle stores are some of the only clothing companies to see sales rise in November. Analyst Cohen points to the video game industry as a sign that young adult buying power remains strong …
But just because young consumers may be able to afford holiday sales doesn’t mean they are spending with abandon. Certainly, the culture of excessive spending itself has been called into question by the current recession. Many report a newfound sense of guilt or unease about buying things. “But I’m young, single and don’t have the burden of property. This sounds really sad, but maybe we’re like the carpetbaggers of the horrible economic situation.”
December 25th, 2008 at 4:02 pm
These folks are not using their disposable income to buy stocks at bargain prices, and may not yet be in the market for a home. We should thank them for their timely support of the consumer economy, but this spending pattern suggests that they have not learned to be more prudent than their elders.