There is more riding on this so-called “Black Friday,” the big shopping day after Thanksgiving, than ever before. It’s the center of a pre-Christmas depression shopping period that economists say will make or break many retailers.
South Carolina Board of Economic Advisors Chairman John Rainey says the American economy is 70 percent consumer driven and economists are watching the next 30 days very carefully, including after Christmas sales.
“Until the consumer comes back, it’s hard to see how this economy is going to get good traction,” says Rainey, “until you see big retailers and little retailers as well being able to sell anything.”
Rainey says while the figures for corporate earnings are edging back up, that’s mostly through cost cutting measures.
Rainey says the question is will the consumers come back this year? “It’s hard for me to see anything to agitate the consumer to spend,” he says. “There’s nothing out there that shows me that employers are ready to start rehiring. So for the short term, I’m not optimistic. If I told you I was optimistic, I’d be whistling past the graveyard. And that’s not why I do what I do.”
South Carolina’s jobless rate last month was once again 12.1 percent, the same level hit in June. Between June and October the rate slid slightly, as more people stopped looking for jobs, at least temporarily. Rainey says depending on the consumer, the South Carolina jobless rate may reach 13 percent by June.
“In this state, with half-a-million people unemployed,” says Rainey, “it’s hard to see the consumer running out to spend money. Clearly those who don’t have jobs won’t be eager to and those with jobs are probably going to be paying down debt, not using their credit cards as much, and taking care of their family balance sheets.”