November 16, 2016 (Washington D.C.) – Today, the JPMorgan Chase Institute released its Local Consumer Commerce Index (LCCI) for July 2016, which showed that 8 of the 15 major U.S. cities experienced negative growth in year-over-year spending. Atlanta experienced the fastest growth of all cities studied at 3.9 percent. Overall, year-over-year consumer spending growth declined by 0.2 percent in July, following slow growth in June 2016. While restaurants contributed 1.3 percentage points to overall growth in July, decreased spending on durables, fuel, and other services more than offset that increase.
This 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, Denver, Detroit, Houston, Miami, Los Angeles, New York, Phoenix, Portland (OR), San Diego, San Francisco, and Seattle. By looking at actual anonymized financial transactions, LCCI offers an ongoing, dynamic view of the health and vibrancy of the U.S. consumer and the places where businesses operate.
“As overall consumer spending growth fluctuates, we continue to look closely at local spending to understand the intricacies behind consumer commerce,” said Diana Farrell, President and CEO of the JPMorgan Chase Institute. “Increased spending at restaurants, which is often discretionary, has been advanced as an indicator of confidence in the economic environment; but decreases in other areas such as durables, other services, and at small businesses are noteworthy and indicate less vibrant local consumer commerce in many cities.”
The key highlights from the latest Index include:
- Spending at small businesses contracted for the second time in this series. Moreover, reductions in spending at small and medium-sized businesses (-0.1 and -1.6 percentage points year-over-year, respectively) more than offset increased spending at large businesses (1.5 percentage points).
- In July 2016, all large cities studied experienced negative year-over-year growth in spending. The average growth rate across the group was -1.7 percent.
- Young and low-income consumers continued to contribute to consumer spending growth. Consumers under 25 and consumers between the ages of 25 and 34 contributed 0.8 and 0.9 percentage points to growth in July, respectively; while consumers in the lowest 20th income percentile contributed 1 percentage point to growth, the largest overall contribution in that month.
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 15 major metropolitan areas; such geographic granularity is unavailable in most other spending measures. These 15 cities mirror the geographic and economic diversity of larger metropolitan areas in the United States and account for 32 percent of retail sales nationwide.
- The index 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 will describe the economic picture of local communities and provide 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: www.jpmorganchaseinstitute.com.
Media Contacts: Nicole Kennedy JPMorgan Chase, Nicole.Kennedy@chase.com, (215) 864-5732