The end-of-the-summer rush for school supplies is a feeling all too familiar to some, but a new study shows back-to-school spending is expected to fall for the first time in nine years.
Overall back-to-school shopping is projected to shrink to $31.2 billion, compared with $34.4 billion in 2022, according to the new report, while consumers are personally expected to spend 10% less this year. Parents and guardians are expected to spend an average of $597, the report found.
The reason for the decline falls squarely on the shoulder of inflation, causing Americans across all income levels to allocate their dollars towards utmost necessities and skip out on non-essential purchases, according to a report released Wednesday by the consulting firm Deloitte.
"Although parents were willing to endure higher prices last year for replenishing (back-to-school) items after the pandemic, 18 months of inflation have changed their tune," Deloitte said, according to Reuters.
JUNE INFLATION REPORT LIKELY TO SHOW 'WAR HASN'T YET BEEN WON'
Deloitte found early one-in-three households were in a worse financial situation than last year, with more than 50% saying they expect the economy to weaken through the end of the year. The survey included over 1,200 parents of school-aged children.
"This back-to-school season is all about economizing. Consumers are looking to save by shopping early, searching out deals, prioritizing spend to essential school supplies ... they're on the hunt for those bargains," said Stephen Rogers, the executive director at Deloitte's Consumer Industry Center.
According to the new report, spending on school supplies is expected to jump 20%, but spending on apparel and technology is set to fall 14% and 13%, respectively, Reuters reported.
AMERICANS EXPECT HIGH INFLATION TO STICK AROUND IN LATEST NEW YORK FED SURVEY
Lupine Skelly, Deloitte's retail research leader said: "This year, people are like 'what is the bare minimum I need to do to get my kids out the door on those first couple weeks of school?' So (parents are) just purchasing the necessities to get that first couple weeks going."
Deloitte's survey also found 69% of shoppers were reliant on sales, such as Amazon’s Prime Day, to help offset increased costs. Nearly 60% of all planned back-to-school purchases will be completed by the end of July, compared with 53% a year earlier, as the date coincides with Amazon’s deals on July 11-12.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
The International Council of Shopping found in a report published last month that nearly half of all Gen Z consumers (48%) shop at discount or off-price retailers such as Walmart, Target, T.J. Maxx, Marshalls, Kohl's. Another 25% shop at Dollar stores, like Family Dollar or Dollar General.
