While the pandemic still hangs over us, many people seem ready to turn the page. The pandemic has changed our lives in many ways, and some of that “new normal” is still making waves.
Let’s see how our colleagues in Global Investment Research analyze the longevity of the top four pandemic trends in the US:
Trend #1: A drop in services spending. We’re spending more on services than we did during the pandemic but still not nearly as much as before Covid struck. That said, it looks like we all just want to have some fun. “Fun” categories like restaurants and domestic tourism have come back strong, while less fun services like doctor and dentist visits, ground transportation and dry cleaning are still sluggish.
Trend #2: A jump in goods spending. We spent a lot on “stuff” when we were stuck at home, as much as 15% more than pre-pandemic. We’re moving back toward pre-pandemic normal on this front, with the gap down to 5%. But again, fun seems more appealing than practicality. Some strong pockets of goods spending remained at the end of 2021, including sports and recreational vehicles, jewelry and watches, and sports equipment. Sofas? Not so much.
Trend #3: Rise of WFH. We seem to be sticking hardest to this trend. An estimated 20-25% of Americans now work from home at least some of the time. The question is whether we can keep this up when there are fewer open jobs and workers have less bargaining power. Our economists think the WFH share is likely to drop in the next (non-pandemic) recession.
Trend #4: Shift to e-commerce. Surprisingly, we don’t seem to have permanently left our favorite real-world stores for their online counterparts. After booming in 2020, the online share of retail sales has been pretty flat in the US and seems to be on track to return to pre-2020 levels next year.
This article is for informational purposes only and is not a substitute for individualized professional advice. Individuals should consult their own tax advisor for matters specific to their own taxes and nothing communicated to you herein should be considered tax advice. This article was prepared by and approved by Marcus by Goldman Sachs, but does not reflect the institutional opinions of Goldman Sachs Bank USA, Goldman Sachs Group, Inc. or any of their affiliates, subsidiaries or division. Goldman Sachs Bank USA does not provide any financial, economic, legal, accounting, tax or other recommendation in this article. Information and opinions expressed in this article are as of the date of this material only and subject to change without notice. Information contained in this article does not constitute the provision of investment advice by Goldman Sachs Bank USA or any its affiliates. Neither Goldman Sachs Bank USA nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of the statements or any information contained in this document and any liability therefore is expressly disclaimed.
Join our Marcus social media community, where we share content and inspiration to help improve your financial health. See you there!