Retail sales figures for September are expected to show a fifth straight monthly increase in consumer spending when the Commerce Department releases its latest report on Friday, though the growth rate is likely to remain slow because of the failure of Congress and the Trump administration to extend additional stimulus to millions of jobless Americans.
Economists at Morgan Stanley forecast a 1.7 percent increase for September, buoyed by auto sales, according to a note last week. Beth Ann Bovino, chief U.S. economist at S&P Global, forecasts a much slimmer increase of 0.5 percent. Sales rose 0.6 percent in August and 0.9 percent gain in July.
Ms. Bovino expects that much of the spending last month was driven by white-collar workers whose economic fortunes have remained relatively stable during the pandemic.
“It is a two-tiered world,” Ms. Bovino said. “People who are working remotely are benefiting from strong equity markets and steady jobs and are spending money on home improvements and new stuff for the home. On the flip side, people tied to the service industry are feeling squeezed.”
Even though stimulus money has dried up, consumers have benefited from a $13.6 trillion savings buffer that accumulated from April through August, the Morgan Stanley economists wrote.
But spending could take a hit based on how the labor market recovers and as uncertainty lingers around the upcoming presidential election and the timeline of a vaccine.
Spending in the United States has been bifurcated during the pandemic, as people continue to spend more at places like grocery stores while cutting back on categories like clothing. Many retail chains started offering holiday deals early and are bracing for a record amount of online orders.
The Business Roundtable, a group of chief executives of major U.S. companies, announced on Thursday initiatives meant to advance racial equity and justice and to reduce the “economic opportunity gap in communities of color.”
The group said it hoped to:
Give $1 billion to community lending institutions, which provide funds for Black households and small businesses, by 2025.
Give $600 million in financial contributions to provide Black- and Latino-led Minority Depository Institutions with capital and deposits, by 2025.
Set up a system to mentor and support Black and Latino small-business owners, with a goal of reaching 50,000 businesses over the next five years.
“The racial inequities that exist for many Black Americans and people of color are real and deeply rooted,” Doug McMillon, president and chief executive of Walmart and chairman of the Business Roundtable, said in a statement. “These longstanding systemic challenges have too often prevented access to the benefits of economic growth and mobility.”
PepsiCo, a member of the Business Roundtable, said on Wednesday that it was committing more than $170 million over five years to support initiatives to “empower Hispanic Americans.” The company said it would expand Hispanic managerial representation to 10 percent of the company’s work force by 2025 by hiring 120 Hispanic managers, including 50 executives.
Every airline is struggling, but each struggles in its own way.
United Airlines relies far more than its rivals on international travel, which is expected to take far longer than domestic travel to bounce back. So the airline is fine-tuning its business, from maintenance to flight planning, as it tries to predict where a wary public will fly, reports Niraj Chokshi.
“We can really throw away the crystal ball, which was hazy to begin with,” said Ankit Gupta, United’s vice president for domestic network planning.
When the virus devastated travel in March and April, United took hundreds of planes out of circulation. Since July, it has brought back more than 150, including those flown by regional carriers, but about 450 are still stashed away.
To understand when and how demand might recover, United is tracking indicators like national travel restrictions, the travel habits of dual citizens and the economic ties between countries. “It’s a bit of gut feeling, to be quite candid,” said Patrick Quayle, who oversees the airline’s international network planning.
Most of the people still flying are staying within the country, visiting friends and relatives or vacationing outdoors. So the airline is gauging how many flights to add to snowy destinations, while adding winter service to Florida from the Northeast and the Midwest. It also plans to expand service on dozens of routes to tropical destinations near and within the United States.
Whatever happens in the months to come, said Tom Doxey, United’s senior vice president for technical operations, “we have a plan in place.”