As the recession deepens, those still untouched keep a wary eye on the economy – and shop for bargains like never before
Katy Krause of Scituate never thought she’d shop at BJ’s Wholesale Club – but there she was last week, pushing a mostly full cart of children’s drinks and other items to her minivan.
Krause, 40, runs a Boston retail shop. Her husband works in financial services. She didn’t pay much attention to prices until gas shot up to $4 a gallon this summer. In September – as the Wall Street meltdown intensified – she finally took her sister’s advice and signed up at the discount superstore.
“Everybody’s talking about the economy,” Krause said. “It’s affecting everyone now.”WHAT IS A DEPRESSION?
A severe downturn in which the real GDP falls by more than 10 percent
WHAT IS A RECESSION?
At least two consecutive quarters of less severe, negative growth
With multiplying layoffs and other signs pointing to a deep recession, the search for bargains seems to have become fashionable again for those like the Krauses, who are financially secure but increasingly cautious.
BJ’s membership has shot up. Shoppers arrive at the Weymouth store in a Mercedes or Saab as well as aging American cars. Local consignment shops are getting visits from customers less willing to pay for a brand-new wardrobe.
Boston University sociology professor Charles Lindholm thinks the coming hard times could inspire fresh interest among many to pursue a pared-down lifestyle that’s “ethical and spiritual,” as Lindholm puts it. But other analysts say the early stage of this recession is simply highlighting a longstanding American tendency to look for the cheap deal, whether the economy is flush or tight.
“A long recession would reinforce that, but we’ve been through this before,” said Boston College marketing professor Kathleen Seiders.
Seiders – a former food-service executive who has commented for CBS and other national media – points to the perennial popularity of Filene’s Basement as but one example.
“Cheap has always been cool,” she said.
Quincy secretary Lorraine Hughes doesn’t think of herself as cool when she shops at the Wollaston consignment shop Finders Keepers. She’s there to stretch her budget, picking up designer-brand apparel for a fraction of department-store prices.
“I used to come occasionally,” she said, as she browsed for shoes and jackets. “Now I’m here all the time.”
Hughes half-joked that cutting up credit cards might be the next thing she and her high school teacher husband do. But Seiders doesn’t think such drastic changes are likely to be widespread, unless the U.S. falls into a full-blown depression.
She expects most Americans will continue “fine tuning” their budget, driving the same car and wearing the same clothes longer, and saving what they can while they shop at cost-cutting stores like BJ’s and Walmart.
“Many people don’t have to do that now, but they’re worried,” Seiders said. “So much consumer behavior is out of fear.”
Randoph parent and Simmons College basketball coach Tony Price sees that reaction, too. While he and his family trim their spending, like everyone else, he also wishes his fully-employed friends and co-workers would take the current crisis as a learning opportunity – about the financial system and their own livelihood.
“This is a wake-up call,” he said. “People who see that will make it a way to make this situation positive.”
Lane Lambert may be reached at email@example.com.
RECESSIONS AND DEPRESSIONS
GDP drop: 33 percent
Unemployment rate: 24 percent
Dow drop: 89 percent
GDP drop: 18 percent
Unemployment rate: 19 percent
Dow drop: 49 percent
GDP drop: 5 percent
Unemployment rate: 6 percent
Dow drop: 45 percent
GDP drop: 10 percent
Unemployment rate: 10 percent
Dow drop: 24 percent
GDP drop: 2 percent
Unemployment rate: 7 percent
Dow drop: 21 percent
GDP drop: 1 percent
Unemployment rate: 5 percent
Dow drop: 30 percent
GDP drop: 0.3 percent
Unemployment rate: 6.5 percent
Dow drop: 40 percent
Source: About.com; Wall Street Journal; infoplease.com; U.S. Bureau of Labor Statistics; U.S. Bureau of Economic Analysis