June 5, 2018, (Washington D.C.) – Today, the JPMorgan Chase Institute released its Local Consumer Commerce Index (LCCI) for February 2018, which showed spending growth in only six out of 14 metro areas analyzed. For the 50th consecutive month, consumers under the age of 35 registered positive spending growth, reflecting the vibrancy of the age group. For the fifth consecutive month, spending on fuel represented the largest growth among product types, spurred on by rising gas prices across the country.
Portland, which led all cities in January with year-over-year growth of 3.4 percent, whipsawed in February to represent the third-largest year-over-year decline, registering 2.1 percent negative growth. Only Chicago and Dallas, with negative growth of 2.9 percent and 2.7 percent, respectively, saw more significant declines from the previous year.
“With 50 consecutive months of positive spending growth, it’s clear that the entry of young consumers into the labor market continues to be a foundational component of economic growth in cities, and local policymakers should take note” said Diana Farrell, President and CEO, JPMorgan Chase Institute. “After months of increased growth in fuel spending, business owners are facing the challenge of managing their own expenses while also worrying about whether those fuel costs will also affect consumer spending.”
Data visualization of the changes in local consumer spending growth over the last 24 months can be found online.
This LCCI report provides a timely view of how the following cities and surrounding metro areas are faring economically, both individually and in aggregate: Atlanta, Chicago, Columbus, Dallas-Ft. Worth, Denver, Detroit, Houston, Miami, Los Angeles, New York, Phoenix, Portland (Ore.), San Diego and San Francisco. By looking at actual, de-identified financial transactions, the LCCI offers an ongoing, dynamic view of the financial health of the U.S. consumer and the vibrancy of the places where businesses operate.
Additional key highlights from the latest Index release include:
- Chicago saw the largest decline in spending, down 2.9 percent compared to the previous year, followed by Dallas with a 2.7 percent decline.
- Houston rebounded to positive growth of 0.7 percent after registering a decline of 0.3 percent in January, its first negative growth rate since Hurricane Harvey.
- The three largest increases among metro areas covered by the LCCI took place in California. San Francisco led the way with 2.5 percent, San Diego had 1.9 percent and Los Angeles registered 1.6 percent positive spending growth.
- Consumers in the bottom income quintile increased spending 3.7 percent, while the wealthiest consumers saw a 1.5 percent decline compared to one year previous.
- Consumer spending at small businesses increased 1.7 percentage points and large businesses saw an increase of 1.3 percent in year over year growth, while spending at mid-sized businesses declined 1.6 percent.
The LCCI offers unique advantages over existing measures of consumer spending.
- The LCCI captures actual transactions, instead of self-reported measures of how consumers think they spend.
- The LCCI provides timely data on spending in 14 major metropolitan areas; such geographic granularity is unavailable in most other spending measures. These 14 metro areas mirror the geographic and economic diversity of larger metropolitan areas in the United States and account for 30 percent of retail sales nationwide.
- The LCCI also presents a more granular view of local consumer commerce through five important lenses: consumer age, consumer income, business size, product type, and consumer residence relative to the location of the business. For each lens, we show how different segments contributed to year-over-year spending growth.
- The LCCI captures economic activity in sectors that previously have not been well understood by other data sources. These include sectors such as food trucks, new merchants, and personal services.
Each release of the LCCI describes the economic picture of local communities and provides a powerful tool for city development officials, businesses, investors, and statistical agencies to better understand the everyday economic health of consumers, businesses, and the places they care about.
About the JPMorgan Chase Institute
The JPMorgan Chase Institute is a global think tank dedicated to delivering data-rich analyses and expert insights for the public good. Its aim is to help decision makers – policymakers, businesses, and nonprofit leaders – appreciate the scale, granularity, diversity, and interconnectedness of the global economic system and use better facts, timely data, and thoughtful analysis to make smarter decisions to advance global prosperity. Drawing on JPMorgan Chase & Co.’s unique proprietary data, expertise, and market access, the Institute develops analyses and insights on the inner workings of the global economy, frames critical problems, and convenes stakeholders and leading thinkers. For more information visit: jpmorganchaseinstitute.com.