US Economy – Business Trends and Statistics During the Obama Era

Strategy Plan One

July 8, 2012

US Economy

The global economy along with the US, experienced difficult economic and financial circumstances over the past few years.  CNN Money has put together and shared some interesting graphs on the economic and financial indicators during the Obama era.  Take a look at some of the results and trends over the past 3.5 years from January 2009 to June 2012.

US Economy – Job Growth

Although slow to dig out of negative job growth, the past 21 consecutive months have shown positive job growth.

Economic indicators - job growth

Unemployment Indicator – US economy

In January 2009, unemployment was sitting at 7.8%.  After a rough 2 year period of increased unemployment, the rate dropped to the current rate of 8.2%, which is now roughly half a percentage point off of the January 2009 figure.

US economy - Unemployment

US Economy – Economic Growth Indicator

Following a similar pattern to job growth, the economic growth GDP indicator illustrated 11 consecutive quarters in positive territory.  Last quarterly report indicated a 1.9% GDP growth rate.

US economy - economic growth GDP

US Economy – Inflation

With the initial period of harsh economics, inflation dipped into negative territory with the falling price of everything from goods, services and house values.  As the economy was slow to turn around, annual inflation started increasing, and during mid 2011, inflation was hitting an annualized rate of roughly 3.5%.  Inflation has now decreased to an annualized rate of under 2%, which can still hinder economic growth.

US economy - inflation

US Economy – Interest Rates

During the initial period of the Obama administration, interest rates climbed to almost 4%, but the respective 2 year period following, rates began to steadily decrease.  Interest rates are now sitting at lower than low rates, but how long can this be maintained.

US Economy - interest rates

To see more economic indicators during the Obama era, check out CNN Money’s article.

More business blogs of interest:

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July 4th – Independence Day Economic Data [infographic]

Strategy Plan One

July 4, 2012

July 4th Independence Day Data

Enjoy the day.  Check out the business and economic data on population, flags and fireworks in this infographic from ThomasNet :

July 4th - Independence day

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Retail Industry Heating up for Summer and Back to School

Strategy Plan One

June 29, 2012

Retail Industry – Summer Period

Like other economic indicators, the retail industry is slowly improving.  It has been estimated that the retail industry will grow in the summer months as food and retail sales increase due to the tourism season.  Retail centered around tourism and travel see marked improvement as many tourism destination packages are developed and offered up to consumers.  Building into the summer retail period, back to school retail sales occur in the summer month, and this year’s consumer trends are interesting.

In terms of consumer behaviour and trends, The National Retail Federation (NRF) – BigInsight have released information on their Independence Day Survey, which highlights 67% or roughly 160 million Americans will be out and partaking in July 4th celebrations.  Retail is estimated to be up in many categories as consumers buy up patio furniture, grills, and beach merchandise.  From the survey, more than 48 million or 23% will buy patriotic US gear and merchandise.  This is a marked 3% improvement from the previous annual survey.

For those businesses centered around events, like fireworks or parades, the survey data shows estimates that 115 million will attend events, and an additional 35 million will be spectators at parades.

Back to School – Retail Trends for 2012

Summer retail period also includes the “back to school” retail craze.  This year’s survey by NRF suggests that consumers may be a bit more frugal this year, indicating that spending behaviour may be down by 5-6%.  Last year the average person spent $603 on all back to school items including clothing, supplies and electronics.  It is estimated that this year’s average spending may be in the range of $580-590 according to the survey.

E-commerce plays a significant role in back to school retail, as the survey data suggests 31% will conduct comparative shopping online and 17% stated that they will shop more online.  Both figures show increasing trends over last year’s survey data.

Here are the comparative results of a BigInsight Consumer spending survey, illustrating consumer behaviour 2010-2012 with respect to back to school retail.

Retail industry - back to school

More responses in this survey show consumers siding with cautious, with very conservative behavioral responses to the survey questions.  Businesses and entrepreneurs should analyze survey data and adjust retail planning accordingly.  For instance, the survey suggests more will be shopping online, the trend of using coupons or find deals is increasing and spending less overall.

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Father’s Day 2012 – Retail Spending Up

Strategy Plan One

June 15, 2012 

Father’s Day 2012 – Trends in Retail Spending

Business and marketing plans can be developed around the volumes of business that calendar events can bring.  Certain days and periods in the calendar, such as Christmas and Easter can make or break retail and service businesses.  However, many spots in the calendar create billions in economic activity for the US business sector.

Similar to Mother’s Day earlier this year, retail spending around Father’s Day has been projected to increase favorably to $12.7 Billion.  According to a recent survey conducted by National Retail Federation, spending will be up by an estimated 10% this year, with estimated average spending at $117.14.

fathers day 2012 - retail spending

Of the projected $12.7 Billion in Father’s Day spending, here are the big-ticket items Dad’s will be receiving:

  • $2.3 Billion on taking Dads to special outings
  • $1.7 Billion on electronic gifts
  • $1.7 Billion on clothing for Dads
  • $645 Million on books and music, and 
  • $641 Million estimated on sporting goods for gifts

Whether you are a retail business with a store front or online, take note of the survey data on where purchases have been estimated to occur:

  • 41.6% will shop for Father’s Day gifts at department stores
  • 34% will hit a discount store for a cheap Father’s Day gift
  • 28.6% at electronic stores, and 
  • 28.4% of all purchases will occur through online retail sites
Moving with the mobile trends in recent news, 26.7% of smartphone users will utilize their devices to research and purchase gifts.
As you develop your business and marketing plans for your retail or services business, keep on track with the massive potential opportunities around calendar events, such as Father’s Day.
Other relevant blogs and articles on economic indicators:

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Construction Industry – April 2012 Economic Statistics Continue to Climb

Strategy Plan One

June 5, 2012 

Construction Industry – April 2012

US Census Bureau Statistics from the construction industry continue on a favorable trend, now estimated to be $820.7 Billion (seasonally adjusted annual rate) for April 2012.  This is significant up from the month of April 2011 with an increase of 7.3% over that month.  It also represents an increase of 0.3% over the March 2012 figure of the $818 Billion seasonally adjusted annual rate.

These are good economic indicator signs, with the construction industry steadily improving for three consecutive months, and follows favorable statistics released on residential construction and residential sales.

construction industry  - april 2012

The biggest gains occurred in the residential construction sector, growing at 2.6%.  However, non-residential construction represents the majority of construction.

Articles and blogs on economic indicators:

Construction Industry News

 

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Travel Industry – Statistics and Impacts on the US Economy

Strategy Plan One

June 3, 2012 

Travel Industry

When it comes to industries in the US, every sector generates massive economic benefits.  The US travel industry is no exception, approaching $2 Trillion in economic benefits generated from this industry.  The US Travel Association has developed great fact sheets illustrating the huge impact this industry has on the US economy.

Interesting to note on the travel industry:

  • $759 Billion in travel expenditures 
  • An estimated $118 Billion in taxes generated from travel industry
  • Over 14 Million jobs are supported; two-thirds of jobs in leisure travel sector

Travel industry - statistics

For those entrepreneurs in tourism and travel interested in the top sources of travel spending:

  • Food Services:  $189 Billion
  • Public Transportation: $140 Billion
  • Accommodations: $136 Billion

Travel industry - leisure travelTravel Industry – Leisure Travel

US statistics from 2010, showed domestic and international travelers spent $526 Billion, generating a tax base of $82 Billion.  Targeting the domestic travelers, the majority of trips (77%) are for leisure purposes.  From the US Travel Association surveys, top leisure travel itineraries include visiting family and friends, travel for shopping and hitting recreational spots.

 

Tourism and travel businesses may develop and craft their business and marketing plans around such important survey information.

Travel Industry – Business Travel

Travel industry - business travel

Business travel represents a significant share of the overall travel industry, at approximately $233 Billion and over 2 Million in jobs in 2010.  It’s staggering to see the 448 Million trips logged by US residents for business.  Another statistic of interest is the fact business travel acts as a catalyst for other business revenue, with an estimated $12.50 in additional revenue to businesses with every dollar spent on business travel.

Additional Blogs and articles:

Travel:

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Economic Indicators – Residential Construction and Sales Showing Positive Signs

Strategy Plan One

May 23, 2012 

Economic Indicators – Residential Construction, Residential Sales

The positive one-two punch of residential construction and residential sales economic indicators are more signs of potential longer term economic recovery.  Recently released from the Census Bureau, both indicators are showing positive growth for April 2012.

Residential Sales

For April 2012, sales of new single family houses were at an annual rate of 343,000 (seasonally adjusted), representing a 3.3% increase over March 2012 and a good 9.9% jump over the April 2011 figures.

economic indicators - residential sales

Image Courtesy: Economic Publicist, FRED

The above graph illustrates some favorable trends in the US in sales growth occurring over the past year, but should be cautiously analyzed as fluctuations are occurring on a monthly basis.

Residential Construction

On another positive front, the US Census Bureau is reporting a 2.6% increase in privately owned housing starts in April 2012 over the previous month, and an impressive 29.9% increase over the April 2011 rate.

economic indicators - residential construction

Image courtesy: calculatedriskblog.com

The housing construction indicator graph closely mimics the housing sales graph above, as the indicators are closely tied together.

 

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Business Trends – Small Business Optimism Index on the Rise

Strategy Plan One

May 8, 2012 

Business Trends

Many economic indicators and sub-indicators of recent months have been favoring positive trends in the economy.  The construction and retail industries have been moving in a positive direction over the 2011 figures.  Entrepreneurs and business owners should carefully watch and analyze the indicators for economic and business trends, and react accordingly in planning and operations.

Business Trends – Small Business Optimism Index

With a recent survey and report out by the National Federation of Independent Business Research Foundation, the Small Business Optimism Index appears on a trendy rise.  LIke the index title suggests, The Small Business Optimism Index is the measure of future business optimism from surveyed participants.  The April 2012 figure gained 2 points to 94.5, the highest value since 2007.

business trends - small business optimism index

From sub-indicators in the index, most are indicating favorable views on increasing employment, capital investments, earning potential, and a general overall positive view on the future economic conditions.

business trends - small business optimism index

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Unemployment Statistics for April 2012

Strategy Plan One

May 4, 2012 

Unemployment Statistics

The Bureau of Labor Statistics has just released more favorable trends in the unemployment statistics.  The Bureau reported the unemployment rate now sits at 8.1%, a 0.8% drop over the April 2011 unemployment figure.  It was estimated that 115,000 more jobs were added in April 2012.

unemployment statistics

Courtesy:  The Washington Post , Bureau of Labor Statistics

Unemployment Statistics – Sectors

The increase in jobs follows the trend of job increases month after month through 2011 and 2012.  However, the trend shows declining number of new jobs over the past 3 to 4 months.  This might be a sign of employment catching up with the recent slight bump in economic recovery.  Slow and steady.  It could also be a sign of a shrinking labor pool that may exist in certain US business sectors.

The lowest unemployment statistics for April 2012 occurred in the government, education and health services, and financial sectors (3.7, 4.8, and 5.5% respectively), while the small business and entrepreneurial sectors of construction, agriculture, leisure, and business services show the higher rates of unemployment.  Recent statistics have shown that those sectors might be experiencing slow recovery mode.

 

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Construction Spending – Construction Industry on the Rebound?

Strategy Plan One

April 13, 2012 

Construction Spending

Construction spending has one of the biggest impacts on economic indicators, as the construction industry is huge.  Construction spending gives us a picture of how well the construction industry is doing in the economy.  Construction, as a major employer is tied to employment and to the housing industry statistics.  The value of construction includes key cost categories such as labor, materials, professional services, and overhead costs.

The following graph from the US Census Bureau shows the trend in construction spending.  The data report indicates that in February 2012, construction spending was at almost $809 Billion, +5.8% increase over February 2011 data.  This represented a $45 Billion increase in construction spending year over year.  Private construction spending accounted for almost a $49 Billion net increase, while public construction spending dropped by nearly $4 Billion.

Overall, the construction industry is on the road to recovery it seems, but still not near the highs of over $1.2 Trillion in construction spending back in 2006.

Value of New Construction Chart

 

 

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