The coronavirus has profoundly altered daily life in America, ushering in sweeping upheavals to the U.S. economy. Among the most immediate effects of the crisis? Radical changes to how people spend their money.
In a matter of weeks, pillars of American industry essentially ground to a halt. Airplanes, restaurants and arenas were suddenly empty. In many states, businesses deemed nonessential — including luxury goods retailers and golf courses — were ordered closed.
“This is the sharpest decline in consumer spending that we have ever seen,” said Luke Tilley, chief economist at Wilmington Trust.
All of the charts in this article are based on a New York Times analysis of data from Earnest Research, which tracks and analyzes credit card and debit card purchases of nearly six million people in the United States. While the data does not include cash transactions, and therefore does not reflect all sales, it provides a strong snapshot of the impact of the virus on the economy.
Here’s a look at how it has already been shifting.
In previous downturns, service businesses like restaurants fared relatively well.
Not this time. With social distancing the norm, most restaurants around the country have been ordered to stop offering sit-down service.
But while most types of entertainment that require people to congregate are on hold, there are a few bright spots. Spending on video game companies like Twitch and Nintendo is booming, and streaming services, including Netflix and Spotify, are enjoying gains as well.
Source: Leatherby, L. and Gelles, D. (2020, April 11). How the Virus Transformed the Way Americans Spend Their Money. The New York Times.