Mary: I’m Mary Walden, with economist MW, welcoming you to the economic perspective. Today’s program looks at spending on goods and services during the pandemic. Mike, economists distinguish between two types of spending: those on manufactured products – called “goods” – and those on services, like health care, finances, and personal services. Did the two types perform differently during the pandemic?
Mike: Summary Answer
- They did
- Both took a hit during the shutdowns
- But since then, spending on goods has totally recovered – in fact, is higher than pre-pandemics, but spending on services is still down 6%
- Reasons: spending on services often involve personal contact, and people are still cautious of personal contact
- Also, federal income help – stimulus checks and extra unemployment compensation – have provided resources to help people resume spending on goods – pent-up demand – like vehicles
- Bottom line – manufacturing has been doing better than services – unusual
- I’m MW
Mary: And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics.