2020 has been a tumultuous year, to say the least, with businesses across the globe feeling the sting of the economic fallout from the COVID-19 pandemic. Despite the challenging conditions, many experts predicted survival but warned of a looming recession. Even so, the final statistics show signs of strength and resilience, with consumer confidence on the rise.
The latest data from the US Census Bureau indicates that consumer spending jumped in the last month of 2020, surpassing expectations and reaching a peak of $1.37 trillion. This figure marked the highest increase since January 2018, and represented an increase of 6% since the previous month.
The positive trend can be attributed to big holiday spending, as well as the current state of the job market. With unemployment now resting at 6.7%, many Americans remain optimistic about the economy. This increase in consumer confidence likely stems from the release of coronavirus vaccines and government-backed relief packages that are slowly beginning to kick in.
Still, 2020 has been an incredibly difficult year for many, with some businesses operating at reduced capacity or shutting down completely. This has understandably weighed on many people’s minds, causing some to slash their spending and put away a larger portion of their income to save for future uncertainly.
One thing is for sure though—as we enter 2021, the state of the economy is front and center on the minds of many. With such high levels of consumer spending in 2020, one can only hope that forecasts of an economic recovery remain on track and that 2021 is a year of continued growth and optimism.