According to the government of Puerto Rico, around 60 people died from the effects of Hurricane Maria. Given the storm’s meteorological profile and the extent of damage observed, the official death count is such an outlandishly low number that demographers have done their own studies to try to arrive at the true number. Two different demographic studies released this month estimate between 1,000 and 1,100 deaths caused by the hurricane. The true numbers are surely higher still for two reasons. First, demographers are not yet able to adjust accurately for the decline in population caused by people moving away immediately before or after the storm hit. Second, the effects of the storm continue, with only about half of the island having electricity and a water supply that is safe to drink and with months to go before major bridges and roads are restored. The hurricane, then, may have caused or advanced the deaths of not too much less than 0.1 percent of the people present. That would be a mortality rate worse than most disasters, but it fits what we know about Hurricane Maria. This was not just another hurricane, but by some measures the worst ever to hit the United States.
Saturday, December 9, 2017
With snow falling in Pennsylvania, I didn’t think about driving anywhere today. Snow is a mixed blessing for retail in the Christmas shopping season. Snow reminds shoppers to buy winter clothes, but it also makes them stay home. An unusually large snow storm on its way from the Rio Grande to New England has taken away a shopping day across the Mid-Atlantic states, but with two weekends remaining before Christmas, today was going to be a quiet day at retail anyway. The snow is light enough, probably 4 inches where I am, that it may be forgotten by tomorrow. In the last two days the same storm paralyzed Gulf Coast cities, but there too, only for a day. I’m told the snow there has melted away already. Heavier snow is expected across most of New England, but that is a region more accustomed to snow and it won’t represent the same level of inconvenience. Despite affecting half the country, this snowfall is only a minor delay for shoppers.
Tuesday, December 5, 2017
The decline at the National Football League (NFL) is now plain to see. At the start of the season, the league could make the case that its decline was not as fast as the decline in U.S. television in general. It seemed possible that some of the decline at the start of the season was temporary. Now with the season winding down, it is clear that this is an ongoing trend outside of the league’s control and bigger than just the decline in television. Here are three news headlines to tell you about the downward trend that has only accelerated since the 2017 season started:
The violence that was on display here is not unique, it’s the kind of thing that seemingly happens on a weekly basis in the NFL.
. . . last night’s MNF [television audience] dipped 2% from the previous season low of the October 16 matchup . . .
Thousands of fans are trying to resell their tickets . . . for as little as $29. . . . Television ratings are down league-wide and empty seats can be seen at many games.
I couldn’t list all the social trends that work against the NFL, but here are a few. The sport is as brutally time-consuming as it is brutally violent. The two largest advertiser categories, beer and pickup trucks, are in long-term decline. The nature of the game encourages fans to have favorite players, yet that means for every player incapacitated there are thousands of fans disillusioned. The science of brain injuries is becoming more precise every year, so that it is now clear to fans that NFL play ruins the lives of a significant fraction of players. The league’s core fans are old men, dying one by one from the diseases of old age.
The core television audience is also old, and this is one of the reasons that television is in decline. Television is so effective at shaping culture that an inevitable cultural split is developing between the television generations, born roughly between 1940 and 1975, and the Internet generations born since 1975. The NFL is just one cultural institution now forced to grapple with this split. The NFL is so financially dependent on television that, for better or worse, it must throw in its lot with that side of the cultural split, but it must find a way to remain relevant or it will fade away as television fads away.
Monday, December 4, 2017
In my own observations of weekend retail in a suburban area of Pennsylvania, there wasn’t the unusual quiet that can follow in the weekends after Black Friday. Traffic in retail areas was busy, if not quite so busy as I saw on weekends in November. This fits with the earlier observation of lighter-than-usual traffic on Black Friday itself. Shoppers have to shop, and if they did not get to the stores in November and are not placing orders online, then they will arrive in the stores eventually, and mostly on the weekend.
Macy’s defied conventional wisdom when it announced it would hire an additional 7,000 workers for its stores. It seems a nonsensical move to consider, coming after Black Friday, which could easily turn out to be the busiest day for department stores this season. It makes some sense if you look at the shopping calendar, however. In years past, the busiest shopping day has sometimes been the Saturday before Christmas. With Christmas falling on a Monday, the two days before could be unusually busy in the stores. Macy’s wants to make sure long lines do not send customers away. If that late burst seems somewhat unlikely in Macy’s case, it is only because stores have already seen strong traffic in November, so that not so many purchases remain to be made in December. There may be some bravado on the part of Macy’s as it tries to show confidence in the face of a difficult balance sheet.
If additional hiring at the tail end of the shopping season is questionable on Macy’s part, imagine the situation from the point of view of the workers. The job market remains weak enough that thousands of job-seekers will compete for the chance to work in a position in which they may have a chance to work only 21 hours, earning around $200 in total. For some of the workers, this may be the only work they have all year long. This could be a good thing or a bad thing, depending on the workers’ circumstances. On Black Friday I saw students and retirees who had been pressed into retail service just for that one day. If your schedule or health doesn’t permit you to work continuously, it makes some sense that you might work on days when you are most needed. For nearly all students, Black Friday and the weekend before Christmas fall on vacations, so work scheduling is not the challenge it would be on most weeks of the year.
While we await word on the fate of Toys ‘R’ Us, there is news this morning on its U.K. stores. The U.K. subsidiary is seeking approval from creditors to close at least 1/4 of its stores. In its statement, the company says its big-box stores are too large to function efficiently. The wording suggests to me that, besides closing some stores, the company is thinking of a future in which stores are about 1/3 the size of its largest stores currently.
That’s a sentiment that could apply even more so to the parent company in the U.S., where cultural trends work against big-box stores. The age group that includes the parents of most U.S. children tend to find big-box stores unfriendly, even alienating. This helps to explain why you may see more grandparents than parents in a Toys ‘R’ Us store. Store traffic could improve if stores were redesigned to make them smaller and more personable, more like traditional toy stores.
Wednesday, November 29, 2017
There are reasons to be optimistic about U.S. retail after looking at the Black Friday weekend in total. One measure of online sales on Cyber Monday, weighted toward larger retailers, estimated a 17 percent increase from 2016. Cyber Monday was the standout day in e-commerce this year, unlike a few recent years when more orders went in on Thanksgiving. The extended shopping weekend came earlier on this year’s calendar than in most years and that may have allowed more shoppers to wait until Cyber Monday to place orders.
If a quiet Black Friday was bad news for retail, a quiet Cyber Monday is always good news. This year I did not see any reports of major web store or transaction processing outages on Cyber Monday, something that happened every Cyber Monday as the crush of shoppers pushed the Internet to its limits until that streak was broken in 2016.
Online sales are still a small fraction of retail, so a large increase in e-commerce doesn’t mean retail totals will be up from last year. Retailers are saying we can expect fewer deep discounts, so it won’t be surprising if totals are down slightly from last year, but that would still make this year more profitable at retail than the last two.
Guns were a big part of the shopping weekend. U.S. gun sales are said to have been the highest ever, and by a wide margin, as shoppers bought millions of firearms as Christmas gifts. While that was good news for gun sellers, two incidents of gun violence at malls on Sunday afternoon cast a shadow over the weekend. Injuries were few, but it is easy to underestimate the impact of an active-shooter mall evacuation. More than 10,000 people were directly affected, whether by running for cover, being locked in a store while police secured the building, or having their shopping trip interrupted or canceled by the evacuation and closure. A much larger number, in the millions, were affected by traffic turbulence, hearsay, and news reports. In an era when retailers are already trying to persuade shoppers that it is safe to go shopping, the two gun incidents, coming on the heels of a series of more serious injuries caused by Black Friday fights, provide a significant setback.
Since the weekend, I have seen the usual seasonal increase in lunch-hour traffic at local retail as shoppers look for quick purchases to finish out their Christmas shopping. Cyber Monday might be seen as the finale of the shopping season, but historically, we can expect a two-week lull in stores, followed by a gradual increase in after-work and weekend shopping. There is a risk of a federal government shutdown early in December, though, and if that comes to pass, all bets are off.