Dive Brief:
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Families with students in kindergarten through 12th grade will spend 10% less on back-to-school items, for an average of $597 per child, according to a Deloitte survey of 1,212 parents with at least one child in school this fall. Overall, spending for the season will reach $31.2 billion.
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Nearly 70% of parents will spend the same or less than last year, and over half of those that are spending less cited lower disposable income. With discounts in mind, 80% of back-to-school shoppers favor mass merchants, 60% look online and 33% favor off-price retailers and dollar stores, Deloitte found.
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Spending on traditional school supplies is up 20%, but down 14% for apparel and down 13% for technology, per the report. Still, nearly six in 10 parents “are willing to splurge on better quality products or to treat their child” when it comes to apparel and technology.
Dive Insight:
Inflation overshadows Deloitte’s results this year, though the monthly Consumer Price Index report for June from the U.S. Bureau of Labor Statistics, released Wednesday, registered inflation at 3%, the lowest rate since March 2021.
Deloitte researchers cite that index in noting a 23.7% increase in the cost of school supplies in the past two years; on Wednesday, according to the government’s June report, the CPI for educational books and supplies fell 2.7% year over year.
Still, it will take consumers time to adjust to slower inflation, according to Deloitte Managing Director Stephen Rogers, an author of the report.
“For this back-to-school season, inflation weary parents are reassessing how they’ll approach shopping,” he said by email. “The entire shopping journey will be about minimizing costs. Parents plan to shop earlier for deals, pay with cash, and prioritize in-store purchases.”
Just over half of respondents to Deloitte’s survey said they expect the economy to weaken in the next six months, down from 54% a year ago, and inflation has eaten away at the finances of 31% of parents. Researchers at Moody’s Investors Service are forecasting weak U.S. growth this year and next, “including a shallow recession in the second half of 2023,” according to a report released this week.
To stretch budgets and seek out deals, Deloitte found that shoppers are starting earlier this year, noting that 59% of back-to-school budgets will be spent by the end of July. That tracks with a report from JLL last month showing consumers shopping for school earlier, although JLL calculated an overall 15.7% increase in spending for the season this year.
