Retail customer trends reveal struggling middle class
During his 2014 State of the Union address on January 28, President Obama focused on the middle class. He described new opportunities for entrepreneurs, initiatives for better education and advances in universal healthcare. However, retail customer trends point to a different shift: a shrinking, struggling middle class left behind by the elite.
According to The New York Times, businesses that traditionally cater to the middle class, such as discount clothing stores and mid-line restaurants, are struggling as high-end stores profit from the increasing wealth of the upper 20 percent. Economists Steven Fazzari, of Washington University in St. Louis, and Barry Cynamon, of the Federal Reserve Bank of St. Louis, explained that the economic recovery is being driven by the upper class, the source added.
In fact, recent Pew research found that fewer Americans consider themselves middle class, identifying instead as lower class. From 2008, the percentage of people who identify as lower class rose from 25 to 40 percent, the survey revealed, and middle class declined from 53 to 44 percent.
For retailers, these trends may indicate a need to reconsider their store operations and marketing strategies. Growing economic disparity may make it difficult for businesses to cater to both the elite and more economical consumers, The New York Times said.
