Leaders.com
  • Business
  • Leadership
  • Wealth
  • Master Classes
  • Business
    • Entrepreneurs
    • Executives
    • Marketing and Sales
    • Social Media
    • Innovation
    • Women in Business
  • Leadership
    • Personal Growth
    • Company Culture
    • Public Speaking
    • Productivity
    • Hiring
    • Social Issues
    • Leaders
  • Wealth
    • Investing
    • Cryptocurrency
    • Retirement
    • Venture Capital
    • Loans and Borrowing
    • Taxes
    • Markets
    • Real Estate
  • Master Classes
Marketing and Sales cooling economy

A Thursday report shows that consumers are spending less. (Photo by Justin Sullivan/Getty Images)

By Hannah Bryan Leaders Staff

Hannah Bryan

News Writer

Hannah Bryan is a news writer for Leaders Media. Most recently she was a reporter for the Sanilac County News...

Full bio


Learn about our editorial policy

Dec 16, 2022

True Sign Of a Cooling Economy

Consumer spending is trending downward, a sign that the economy may be starting to cool. 

Key Details

  • A Thursday report from the Commerce Department revealed that consumer spending declined in November even further than projected. 
  • Sales dropped 0.6% last month, lower than the estimated 0.3% drop the Dow Jones had predicted.
  • This marks the largest drop in retail sales in a year. 
  • The decline was across multiple categories, including furniture, which fell by 2.5%, building materials declined by 2.5%, and auto parts dropped by 2.3%. 
  • Online sales also saw a decline of 0.9%. Bars, restaurants, and food and beverage stores saw a nearly 0.9% increase.
  • Though spending is beginning to decline, fewer unemployment claims were filed during the same time period. Weekly claims fell by 20,000.
  • Following the report, the Dow Jones Industrial Average has fallen nearly 900 points. 

Why it’s news

Declining consumer spending is an indicator that the economy may be cooling, though the labor market remains strong. Manufacturing declined along with retail sales. 

Despite the drop in spending, employers have retained their employees for the most part—resulting in a strong labor market. 

While consumer spending fell, so did applications for unemployment benefits. New applications were at their lowest levels in a two-month period, but the amount of time individuals stay on unemployment is climbing, Bloomberg reports.

The data points to a likely slowing economy, something the Fed has been hoping to achieve since it began raising rates. So far this year, spending has continued despite rate hikes due to larger savings accounts accumulated during the pandemic. However, as savings begin to dwindle, spending will decrease. 

Even with the beginning signs of a slower economy, the Fed isn’t planning to back off rate hikes any time soon. On Wednesday, Federal Reserve Chair Jerome Powell indicated that the bank will need to continue hikes. According to Powell, the labor market is still too tight, and growing wages could further spur inflation.  

One of the driving factors behind inflationary growth has been continued consumer spending. The drop in spending last month is a welcome sign to the Fed as it indicates that the bank’s methods are starting to have the desired effect.

However, the drop could be influenced by early holiday shopping. Retailers offered better discounts than usual this year in order to move inventory. The ensuing holiday shopping could have skewed October’s consumer spending numbers, making the decrease from October to November look more significant. 

Additionally, American consumer spending habits are shifting as consumers spend more on services rather than goods. Continued spending doesn’t appear sustainable as more Americans rely on credit cards to make purchases.

Home / News / True Sign Of a Cooling Economy
Share
FacebookTweetEmailLinkedIn

Related Stories

Seattle Takes The Crown For Advanced Tech Talent

by PJ Howland Leaders Staff
Tech

Oct 24, 2023

Seattle tech talent

Seattle has emerged as the metro area with the most advanced tech talent, beating out tech hubs like San Francisco and Silicon Valley.

Key Details

  • According to a new ranking by the Burning Glass Institute, Seattle has the highest proportion of advanced tech workers compared to other cities with similarly sized tech workforces.
  • The ranking evaluated 60 million high-paying, in-demand tech job postings and histories to identify cities with cutting-edge roles like AI and cybersecurity rather than legacy tech positions.
  • With tech giants Amazon and Microsoft headquartered in Seattle, the city edged out the San Francisco Bay Area, Boston, Austin, and Raleigh on the list.
  • The report found that demand for software developers and IT support specialists has declined over the past five years as companies seek more specialized tech talent.

Go deeper

FacebookTweetEmailLinkedIn

More Americans Can’t Keep Up With Car Payments

by Colin Baker Leaders Staff
Loans and Borrowing

Oct 23, 2023

car loans, used cars

A record number of Americans are behind on their car loan payments as higher interest rates and prices weigh on consumers.

Key Details

  • According to data from Fitch Ratings, 6.11% of car loans were at least 60 days delinquent in September, the highest since tracking began in the early 2000s.
  • Some interest rates on used cars can rise to as much as 21%, according to Bankrate.
  • Soaring prices and rising interest rates are squeezing consumers, making it difficult for some to keep up with their auto loans.

Go deeper

FacebookTweetEmailLinkedIn

Chevron Makes $53 Billion Deal Amid Surging Gas Prices

by PJ Howland Leaders Staff
Markets

Oct 23, 2023

Chevron Gas Deal

Chevron is acquiring Hess Corp. for $53 billion, the second significant oil producer acquisition this month as crude prices climb.

Key Details

  • Chevron is purchasing Hess in an all-cash deal worth $53 billion, including debt and preferred stock redemption.
  • This comes just weeks after ExxonMobil announced its $59.5 billion purchase of Pioneer Natural Resources.
  • With oil over $80 per barrel, major producers are using their windfall profits to acquire smaller players and boost payouts to shareholders.
  • Chevron expects the deal to close in H1 2023 pending regulatory approvals and Hess shareholder vote.
  • Hess CEO John Hess will join Chevron's board once the acquisition is complete.

Go deeper

FacebookTweetEmailLinkedIn
nike logo
Company Culture

Oct 20, 2023

Nike to Require More In-Office Days From Employees

by Colin Baker Leaders Staff
blue collar workers
Retirement

Oct 20, 2023

Explaining The ‘C+ Grade’ Retirement Ecosystem in The United States

by PJ Howland Leaders Staff
netflix building
Entertainment

Oct 19, 2023

Netflix Hiking Prices While Adding Millions of Subscribers

by Colin Baker Leaders Staff

Recent Articles

Hiring

Nov 1, 2023

Learn the Winning Answers to the Most Common Phone Interview Questions

Come to your next phone interview fully prepared

Personal Growth

Oct 30, 2023

85 Quotes on Self-Love to Boost Your Self-Esteem

Don’t fall into the trap of harsh self-criticism

Company Culture

Oct 27, 2023

What is a Sabbatical? Your Ticket to Restful Growth and Meaning

Sabbaticals can benefits both employees and businesses

  • Business
  • Leadership
  • Wealth
Join the Leaders Community

Get exclusive tools and resources you need to grow as a leader and scale a purpose-driven business.

Subscribing indicates your consent to our Terms & Conditions and Privacy Policy

Leaders.com
  • Privacy Policy
  • About
  • Careers
  • Cookie Policy
  • Terms
  • Disclosures
  • Editorial Policy
  • Member Login

© 2025 Leaders.com - All rights reserved.

Search Leaders.com