The rate at which consumers are saving their incomes is up considerably since the beginning of the COVID-19 pandemic, federal data show.
The saving rate is a key consideration retailers should follow as consumers adjust their confidence in the economy and their willingness to use their incomes to shop.
Using data from the federal Bureau of Economic Analysis, the nation’s savings rate rocketed from 8.3% in February, just before the pandemic in the U.S. to 33.7% in April, reports Kriss Sjoblom, vice president/economist for the Washington Research Council. The rate declined to 14.1% in August, which Sjoblom noted was still significantly higher than before the pandemic began spreading across the U.S.
Over the same period, Sjoblom notes that personal income in the U.S. increased 2% in August compared to February. It declined in August after the special federal $600-per-week unemployment benefit ran out at the end of July.
Sjoblom notes that the data is preliminary and will be revised as statisticians gain access to more economic information.