As the summer winds down, parents everywhere breathe a sigh of relief, ready to reclaim their homes from the gremlins who inhabited them for 7 hours more each weekday than they would through the rest of the year. But with inflation at a 40-year high, relief may not be in sight, as back-to-school spending hits record highs.
The Value of Education is Intangible, but…
The return to school is precipitated by the “back-to-school” shopping window, where parents lay down hard-earned cash to buy the supplies their students need to be successful. This year, that window is open a little longer, with 25% of shoppers surveyed reporting getting an earlier start. In addition, 64% of respondents stated that they would focus more on seeking out sales this year and doing more comparative shopping online.
Total spending per household is projected to set a record high, with the National Retail Federation (NRF) reporting an estimated $864 per household (up $15 from last year’s high) and nearly $37B in total national spending.
The Impact of Inflation is Hard to Measure
Interestingly, while inflation is affecting household strategies for BTS shopping, it doesn’t seem to be impacting overall spending, with projected budgets exceeding pre-pandemic levels. In fact, the growth in planned spending actually outpaces inflation in some categories.
Looking into the data available from NRF, many traditional shopping categories (including computers and clothes) have seen inflation across the board, ranging from 2% to 22%. However, when looking at the same 3-year period since 2019, total planned (expected) household spending on these same categories grew in the range of 36% to 41%.
So, families are willing to shell out more, but they understand their dollar won’t stretch as far.
This may be in part to rising wages, low unemployment, and the general acceptance of back-to-school spending as necessary. In either case, many families are opting to reuse supplies, or dipping into savings if necessary to cover the cost.
Back-to-School Spending Categories
The three largest categories of back-to-school spending are electronics, clothes, and shoes, respectively. Pandemic-fueled digital acceleration in schools has increased the need for personal electronics for students of all ages, while clothes and shoes are always a given.
School’s In Session
At the end of the day, while inflation ravages economy, parents ultimately will still make sure their children are prepared to tackle the new school year armed with all the necessary equipment. And while it may hurt the wallet in the short term, the good news is that you’ll have just enough time to recover financially before it’s time to start Christmas shopping.