America's big spenders seek value
Source: Agencies |
April 17, 2011, Sunday
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Print Edition
Print Edition
RICH Americans are expected to spend an extra US$26.6 billion on luxury goods this year but will do so with an eye toward value as the country recovers from recession, a poll released on Friday found.
Spending on luxuries, excluding cars and travel, is set to rise 8 percent to US$359 billion compared to 2010, according to the sixth annual American Express Publishing and Harrison Group survey.
While the number of affluent families planning to spend more has almost doubled in the past three years, they are emerging from the recession seeking value, quality and service for their money, said Jim Taylor, vice chairman of Harrison Group.
"There will be more money spent, but it doesn't mean it won't be spent without the prudent skills learned as the result of a very difficult recession," Taylor said. "This is a survivor's economy with people who have succeeded in surviving the recession demanding a new form of respect."
The Survey of Affluence and Wealth in America polled 1,458 families with a discretionary income of more than US$100,000 - representing the wealthiest 10 percent in the United States who account for about 50 percent of all consumer spending.
It found that 15 percent of these families plan to spend more in 2011, up a quarter from 2010. The number of families cutting spending was nearly halved from last year to 9 percent and down two-thirds from 2008.
Rich families save on average a quarter of their incomes annually, the poll found, and 34 percent said they were looking forward to spending more money this year.
Taylor said that while 70 percent of affluent Americans still believe the country was in recession, they were less anxious. Concern over job loss has fallen 50 percent from 2010 and worries about the potential failure of their companies are down to 11 percent from 28 percent.
Almost three-quarters said they had become more resourceful because of the recession.
A 2010 stock market rally, which pushed up the Dow Jones Industrial Average 11 percent, has also helped sway consumers.
Consumer spending, which accounts for 70 percent of US economic activity, grew at a brisk 4 percent pace in the final three months of last year.
Spending on luxuries, excluding cars and travel, is set to rise 8 percent to US$359 billion compared to 2010, according to the sixth annual American Express Publishing and Harrison Group survey.
While the number of affluent families planning to spend more has almost doubled in the past three years, they are emerging from the recession seeking value, quality and service for their money, said Jim Taylor, vice chairman of Harrison Group.
"There will be more money spent, but it doesn't mean it won't be spent without the prudent skills learned as the result of a very difficult recession," Taylor said. "This is a survivor's economy with people who have succeeded in surviving the recession demanding a new form of respect."
The Survey of Affluence and Wealth in America polled 1,458 families with a discretionary income of more than US$100,000 - representing the wealthiest 10 percent in the United States who account for about 50 percent of all consumer spending.
It found that 15 percent of these families plan to spend more in 2011, up a quarter from 2010. The number of families cutting spending was nearly halved from last year to 9 percent and down two-thirds from 2008.
Rich families save on average a quarter of their incomes annually, the poll found, and 34 percent said they were looking forward to spending more money this year.
Taylor said that while 70 percent of affluent Americans still believe the country was in recession, they were less anxious. Concern over job loss has fallen 50 percent from 2010 and worries about the potential failure of their companies are down to 11 percent from 28 percent.
Almost three-quarters said they had become more resourceful because of the recession.
A 2010 stock market rally, which pushed up the Dow Jones Industrial Average 11 percent, has also helped sway consumers.
Consumer spending, which accounts for 70 percent of US economic activity, grew at a brisk 4 percent pace in the final three months of last year.
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