Tags: winter | weather | consumer | spending

After Winter-Weather Financial Pain, Summer Could Push Consumers Over the Edge

By    |   Wednesday, 14 May 2014 08:09 AM

As part of the monthly unemployment report, the Bureau of Labor Statistics collects data on how many employees missed work because of bad weather. In February, unusually cold and severe weather kept more than 7.4 million workers at home. Only about 900,000 workers missed work because of the weather in January and fewer than 800,000 lost time in March.

When it comes to employees missing work because of weather, February stands out as the worst month in history (official data starts in 2004), with 5.1 percent of the workforce losing hours to the weather.

While the bad weather has been used to explain almost every aspect of the weak economy, its most significant impact would have been on consumer spending, and the damage from the weather would have been centered on those who can least afford a financial setback. Many hourly workers would not have a chance to make up the lost income.

Another financial setback in the first quarter came from high utility bills. Consumers who lost wages often ended up spending more than average on heating bills.

It is often said that a journey of a thousand miles starts with one step. If this is true in the economy, and it certainly seems to be, February's lost wages and high utility bills could turn out to be the first step toward a recession. Unless consumers see a significant reduction in their expenses during the next few months, they will have difficulty recovering from the winter's setbacks.

We could see another seasonal factor — higher gas prices in the summer — be the factor that pushes consumer finances past the breaking point and triggers a recession.

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MichaelCarr
As part of the monthly unemployment report, the Bureau of Labor Statistics collects data on how many employees missed work because of bad weather. In February, unusually cold and severe weather kept more than 7.4 million workers at home.
winter, weather, consumer, spending
275
2014-09-14
Wednesday, 14 May 2014 08:09 AM
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