Here’s What We Bought In September According To The Census Bureau

Well, dear reader, would you like the good news or the bad news first?

Earlier this month, the U.S. Census Bureau released monthly results tackling our spending in September. The monthly report is short but sweet and it outlines American consumer habits regarding how much we’re spending and what we’re spending our money on. If the past few reports have shown us anything, it’s that spiking gas prices, inflation, and market woes have taken a bit of a bite out of our confidence. So, then, what about classic spending moments like Back-to-School? Let’s dig in and take a look.

According to the latest update, consumers spoke up by not saying much at all. Advance monthly sales stagnated at $684 billion, in-line with August results. However, both August and September were a bit higher than July’s numbers, which came in at $681 billion.

The relative flatness of total spend has a few culprits according to Chip West, a retail and consumer behavior expert at Vericast. West cites anxiety from “sky-high prices on everything from mortgages, gas, food and healthcare,” as working against desires to spend. “Due to this, they are a little more reluctant to open their wallets than in previous months.”

Recent results from the September Consumer Tracker survey by John Blackledge and team at Cowen backs West up. After speaking with about 2,500 consumers, they found that, “an increasing number of consumers are cutting spend due to inflation, despite stabilizing month/month prices.” More respondents (75%) reported cutting spending in the month compared to the 64% who did so in July and August, according to Cowen. Top items consumers planned to cut to lessen the squeeze were social events and dining out (64%), travel (56%), and groceries (49%.)

So, what did we buy in September, anyway?

Although the total numbers are relatively unchanged, when we drill down, some categories saw slight increases, starting with food and beverage, which rose to $79.4 billion from $79.1 billion in August. In response, Neil Saunders, managing director of GlobalData, minced no words, noting that the prevailing rate of food inflation hovered at over 13%. “The gap between inflation and sales growth is the result of consumers trading down more, cutting out purchases of expensive products like meat, switching where they shop for groceries, and in some cases reducing the amount they buy.”

Importantly, “accelerating shifts in the food sector are a warning sign that the finances of many households are under an increasing amount of pressure,” according to Saunders. Despite consumer offsetting, another tiny win in the report comes through food and drink establishments, which ticked up to $87.2 billion from $86.7 billion in August.

Despite back-to-school shopping falling into September, the venues and places that we might expect to benefit from the shoppers also remained relatively unchanged, although some reported slightly higher results than August. Clothing and accessories stores rose to $26.2 billion from $26.1 billion in August, while general merchandise rose to $70.1 billion from $69.6 billion in August.

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Auto parts vendors and dealers slid to $127.5 billion from $128 billion in August. And gasoline stations also took a hit, dropping to $62.8 billion from $63.7 billion in August. Gas prices remain on the hot list for consumers, with 70.9% of respondents to the Cowen survey reporting that their spending was impacted in September by higher gas prices. Notably, however, as fuel prices spiked in June, 74.5% of the survey’s respondents reported that it impacted their spending, representing a slight drop from June.

“The numbers are an indication that the consumer is surviving but not thriving,” according to Saunders.

Finally, cutbacks didn’t seem to impact a category near and dear to most of us, the “Treat Yo Self” category. In September, consumers prioritized their health and personal care, spending $33.9 billion, up from $33.7 billion in August.

Per Saunders, as we head into Holiday, “retailers will have to work very hard for gains over the holidays, inducing discounting and promoting. This will come at the expense of margins and profits, and we expect some weak trading numbers as we enter the new year.”

So, the good news is that if numbers continue to trend as they have, Holiday sales and promotions for 2022 might be the most off-the-chain of their kind that we’ve seen in a long time.

The next round of monthly sales numbers is expected on November 16.

Author’s Note: Unless otherwise indicated, dollar amounts in this article are adjusted for seasonal variation and for holiday and trading day differences, but not for price changes.