How Has The Recession Changed What We Buy?
Since so many households around the country have been hit hard by the recession, people across the country have had to radically transform their spending habits. This means that expenditures for luxury or expensive goods goes down, while that spending is replaced in cheaper substitutes. This week, The Economist published a nifty infographic that details all the different ways that Americans have changed their consumption habits in the past four years.
For starters, there are a lot of not-very-surprising trends: huge drops in eating out, new clothing, smoking, drinking alcohol (covered on Care2 here), and automobile purchases. Basically, luxury items and unnecessary expenditures have completely fallen off a cliff. Likewise, investment in necessary durable goods — like cars and clothes — has dropped off as well, likely to pick up again either as stocks wear out or when the economy recovers at some point.
The infographic, though, also points to some other disturbing trends in American consumption habits. For example, although the total expenditures on food have gone down, the amount spent on processed vegetables have gone way up. This means that households are shifting their diets away from healthy, fresh vegetables and moving towards cheaper processed foods, which are not nearly as healthy.
There are a lot other significant problems in the data: private investment in education has fallen along with expenditures in private insurance. Healthcare spending is stagnant. Given these drops, it looks like many households have had to choose between future health and productivity and spending just enough to scrape by today.
Unfortunately, this means that households have been dipping into their savings to stay afloat, if they haven’t already fallen into poverty. These numbers just underscore the fact that the effects of the recession are still lingering — and could have even farther-reaching effects if the politicians fail to step in to safeguard families’ health, education and nutrition.
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