Deloitte Consumer Spending Index Moves Upward in May

NEW YORK, June 17, 2013 /PRNewswire/ -- The Deloitte Consumer Spending Index (Index) rose in May, buoyed by improving real home prices, initial unemployment claims and real wages. The Index tracks consumer cash flow as an indicator of future consumer spending[i].

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"Three out of the four components of the Index contributed to an uptick in May and have stayed on a moderate and steady track of improvement over the past several months," said Daniel Bachman, Deloitte's senior U.S. economist.   "The labor market has stabilized, and initial unemployment claims fell nearly six percent since this time last year, while real home prices continued to climb and real wages crept up."

The Index, which comprises four components — tax burden, initial unemployment claims, real wages and real home prices — rose slightly this month to 4.27 from a reading of 4.12 the previous month.  

"Mother nature – rather than the economy or consumers – dealt retailers a wild card this spring,"   said Alison Paul, vice chairman, Deloitte LLP and retail & distribution sector leader.  "Retailers should take a cue from the past year's weather as a reminder of the many volatile and unforeseen factors that may affect their sales.   Predictive modeling and scenario planning can help retailers prepare for potential business disruptions, which can have a profound impact as they head into their busy and profitable back-to-school and holiday seasons."

Highlights of the Index include:

Tax Burden: The tax burden remained flat compared with the previous month, but rose 2.26 percent from last year.

Initial Unemployment Claims: Claims moved down to 343,000 in April, nearly a six percentage point decrease from a year ago.   

Real Wages: Hourly real wages moved up 0.4 percent from the same period a year ago, reaching $8.81.

Real New Home Prices: Real new home prices climbed to $117,329, an 8.5 percent increase from this time last year.

About Deloitte's Retail & Distribution Practice

Deloitte is a leading presence in the retail and distribution industry, providing audit, consulting, risk management, financial advisory and tax services to more than 75 percent of the Fortune 500 retailers.  With more than 1,400 professionals, Deloitte's retail & distribution practice provides insights, services and solutions assisting retailers across all major subsectors including apparel, grocery, food and drug, wholesale and distribution and online. For more information about Deloitte's retail & distribution sector, please visit www.deloitte.com/us/retail-distribution.

As used in this document, "Deloitte" means Deloitte LLP and its subsidiaries. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries.  Certain services may not be available to attest clients under the rules and regulations of public accounting.

[i] The Deloitte Consumer Spending Index is a proprietary methodology that analyzes economic factors to gauge consumer cash flow as an indicator of future spending.  Deloitte's analysis includes data from the U.S. Commerce Department, Bureau of Economic Analysis, U.S. Bureau of the Census, U.S. Department of Housing and Urban Development and the U.S. Department of Labor.

SOURCE Deloitte