The United States economy has been witnessing a remarkable recovery since the Great Recession of 2007. The growth in GDP went up from 2.2% in 2017 to 2.9% in 2018, with projections for a growth rate of 2.3% in 2019. Additionally, the unemployment rate in the U.S. and New York has been declining in the last several years. In the U.S., unemployment dropped from 4.1% in 2017 to 3.9% in 2018 with projections to lower to 3.6% in 2019. In New York, the unemployment rate increased only slightly from 4.2% in May 2018 to 4.3% in May 2019. Despite the overall decreasing rate of unemployment, recent shifts in consumer spending show a preference for online shopping and a decrease in holiday shopping. Describing this shift to online shopping The Balance reports: “Consumer spending was at a rate of $14.24 trillion as of the first quarter of 2019. U.S. retail sales were soft. Total holiday sales only rose by 2.3%. That’s lower than the 10-year average of 3.5% annual increase before the recession. Fewer people shopped on the three-day Black Friday weekend in 2018. That’s because they waited for online sales later in the season. Consumer spending trends show a definite move toward online shopping versus shopping in brick-and-mortar stores. Department store sales fell by 3.3% while online retailers saw a 3.7% increase over last year” . Another indication for the strong economy is the constant raise of the confidence consumer rate in the last years, although the Consumer Confidence Board reports that the Consumer Confidence Index went slightly down in June 2019 to 121.5, which is the lowest level since September 2017.
The nearing presidential election of 2020 will emphasize critical issues that may have a crucial impact on small businesses. For example, Dem. Bernie Sanders promises to pass the Loan Shark Prevention Act, that would set interest rates for consumer loans and credit cards at 15%, so that entrepreneurs and small business owners can have better access to the credit they need to build and grow their companies. Likewise, Republicans are planning a campaign with promises of additional tax cuts that will also benefit small businesses.
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