Looking Beyond Today’s Austerities

There’s no scarcity of reports about consumers paring their expenditures due to the shaky economy. But in the long run — perhaps even before we’re all dead — the economy will recover. What will people do then? Polling by Booz & Co. took a look at that matter.

To the extent people can accurately see beyond what Booz terms today’s “frugal mind-set,” the poll (fielded in late September) suggests there will be some long-term shifts in behavior. Many respondents feel lastingly chastened when it comes to impulse buys at the store cash register: 31 percent have economized in this way, and just 1 percent said they’ll undo this step when economic good times return. As for shopping less at expensive stores (a step adopted by 32 percent), it’s telling that just 1 percent expect to revert to past spendthrift practice. But the polling indicates that eating out will bounce back: While 43 percent said they’ve been eating outside the home less as a way of saving money, 28 percent said this is something they’ll undo. On the other hand, just 7 percent said they’ll undo the frugality (adopted by 35 percent) of eating at fast-food restaurants less often. Twenty-eight percent said they’ve been taking cheaper vacations; 11 percent said this is a step they’ll undo.

Some less-common frugalities look likely to expire as the economy recovers. Among the 7 percent of respondents who said they’ve been buying new clothes only for work, nearly all (6 percent) will undo this step. About half the 7 percent who’ve been deferring appliance purchases will reopen their wallets for these. However, it’s plausible that people will discover they enjoy some of the things they’ve initially done for financial reasons. Twenty-eight percent said they’ve been saving money by engaging in more “free” activities, such as hiking or going to the beach, and just 2 percent think this is something they’ll undo when the economy recovers. Likewise, 27 percent have been economizing by entertaining friends at home instead of going out. If these “at homes” have been fun, it’s quite believable that just 3 percent will undo this behavior.

Time will tell, though, whether just a small minority undo some austerities that aren’t intrinsically fun. For instance, 30 percent said they now order less food when eating out, and a mere 3 percent identified this as something they’ll undo in better economic times. If I were a waiter, I’d hand everyone the dessert menu anyway.