New Economic Indicator? Coffee and Donuts
By Kristina Zurla Landgraf • Jul 1st, 2010 • Category: The Lighter SideEconomists are constantly mining data to determine where the economy is headed. A recent Wall Street Journal article showed how increased coffee and donut consumption reflects more than just jitters and jiggly bellies. (Article excerpt below.)
Enter the coffee indicator. A “tell-tale sign of how consumers feel about employment, income and the future is where they buy their coffee and whether they step up for the more expensive concoction,” wrote Majestic Research economist Steve Blitz in a recent research note.
Majestic Research tracks anonymous credit-card data, and can see how much consumers spend by category and store. Blitz broke out the average dollar transactions at Starbucks and Dunkin’ Donuts. The data show that during the worst of the recession consumers spent less at the two coffee outlets, but as the employment picture started to improve people were willing to spend more per transaction. Read the full article.
