Economists aren’t sure yet if the extreme winter has put a deep freeze on the economy. Recent consumer spending reports show people are hunkering down and staying inside instead of venturing out and spending money.
At Okemos ACE Hardware, January, February and March are usually the slowest time of the year. But not this year. Demand for rock salt, snow shovels, and other winter gear has owner Jim Raynak working around the clock. “Just trying to get supplies, on the computer all the time trying to reserve stock, and with ACE you can do it 24 hours around the clock, so sometimes, like this morning, I was up at 3 o'clock in the morning trying to reserve salt."
Rock salt is one of the few items shoppers seem to have on their list this winter. If they don’t need a shovel, hand warmers or a space heater, they’re shutting their wallet and staying home. Economists say retail sales have been sluggish this winter. Charles Ballard, from Michigan State University says, “How much of the weakness that we've seen in December and January is due to the bad weather, and how much of it is due to all the other things that are going on in the economy, my sense is that it probably has put a little bit of a drag on the economy but not huge."
Recent reports show companies across the nation are still adding jobs , but at a slower rate. Ballard says, “We're definitely not falling into a free fall, its just that the economy has been growing less rapidly than it was a few months before."
It’s still to early to tell for sure if the freeze on the economy is temporary, and will rise along with the thermometer. Until then, retailers like Okemos ACE Hardware will keep cashing in. “As soon as it hits 35 degrees its over."
There is some good news for retailers. On Friday, the University of Michigan released its U.S. Consumer Sentiment Survey, which measures how optimistic people are about the economy. It’s up .4, from 81.2 in December to 81.6 in January.