“For the poorest Americans, this year’s holiday season offered little respite from the lingering Great Recession. Despite signs that the American economy has been strengthening in recent months, households grappling with limited means have seen little to no improvement in their fortunes, some economists say.
The latest sign came Thursday as one of the nation’s largest dollar store chains — which caters heavily to customers with low incomes — said that December sales had been meager, an indication that many families bought fewer toys for children, and likely scrimped to finance necessities, such as groceries, instead.
“On the low end of the spectrum people are still hurting quite a bit,” said Chris Christopher, an economist at IHS Global Insight. “The median household income adjusted for inflation has dropped steadily over the past 3 or 4 years. Living paycheck to paycheck is more than a perception, it’s a reality.”
On a conference call Thursday, Family Dollar CEO Howard Levine told analysts that his company’s customers passed on toys in favor of “basic need” items. “Clearly [our customers] don’t have as much for discretionary purchases as they once did,” he said, citing economic pressures like gas prices and rising payroll taxes.
Other retail sales data released Thursday also indicated that many Americans abstained from lavish holiday celebrations this year. Target announced today that sales at its stores open at least a year were flat in December. At Family Dollar, sales at stores open at least a year rose 6.6 percent over the last three months of 2012. But in December, traditionally a busy shopping month, they rose only 2.5 percent. On Thursday, the company’s stock dropped 13 percent….”
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