National consumer sentiment posted a small gain of .4 percent in the month of August, but remains significantly lower than the same period one year ago. That’s according to a report put out by the University of Michigan’s Surveys of Consumers.
“Right now everything is so weird. It’s really hard to take any one data point and try to make sense.” — Sandy Baruah, Detroit Regional Chambers
Sandy Baruah is president and chief executive officer of the Detroit Regional Chambers. He tells WDET’s Alex McLenon that while consumer sentiment reflects how people view the economy, it does not reflect where people feel comfortable doing business.
Click on the player above to listen to the Detroit Regional Chambers’ Sandy Baruah on the state of the economy, and read a transcript, edited for length and clarity, below.
Alex McLenon, 101.9 WDET: Are certain businesses in the Detroit region doing better than others based on how they’re handling COVID-19 protocols and where do people feel safe?
Sandy Baruah, Detroit Regional Chambers: People certainly feel safer doing business with businesses who have done a better job of insulating the customer from as much human contact as possible. For example, restaurants are now doing a much bigger take out business than they have before. So restaurants who have mastered the art of moving from dine-in only to both dine-in and takeout or delivery are doing better than those who are just sticking with dine-in.
Nationally consumer sentiment is up about 0.4% but is still down from last year. The University of Michigan in its own report went as far as to call it trend less. Is that the same thing we’re experiencing in this region?
The University of Michigan has been largely flat over the last three months or so. The Conference Board, which is the other blue chip standard for conference sentiment has varied a little bit and is down.
I don’t know where Michigan stands specifically on consumer sentiment versus the nation. I wouldn’t be surprised if it was a little bit higher because our consumer spending is actually up 3% since the beginning of the year, and that’s another University of Michigan number. Actually it’s up about 3.7% since January, which is kind of surprising – where nationally it’s down about 7.7% compared to January.
Right now everything is so, “weird,” for the lack of a better phrase, to be honest. It’s really hard to take any one data point, or any almost any set of data points, and try to make sense.
A lot of the focus right now has been on the school’s reopening. As that happens, is there anything we can learn or gauge off of how the schools do that can impact what’s next for businesses in the area?
The schools reopening is important in the sense that a lot of employees are only able to go back to work, or go back to work full time, if they’re able to send their children to school. If their children have to remain home to do remote learning then it’s very difficult for these employees to go back to work.
It’s just a fact of life. If your children have to stay home, especially if they are younger children, you have to be home with them. It is, I think, physically impossible to both be an employee, a teacher, and a caregiver all at the same time. I think that’s asking too much from a human being.