Western Livestock Journal Sep 10, 2021
- Steve Dittmer
- Sep 10, 2021
- 2 min read
Updated: Jan 9, 2022
Source: Steve Dittmer | Western Livestock Journal https://www.wlj.net/opinion/dittmers_take/dittmer-s-take-september-questions/article_a7df8be2-1246-11ec-b155-c302d2e2a552.html
September questions
This is shaping up to be an unusually chaotic September, affecting all aspects of U.S. life. Politically, big struggles are afoot. Economically, some serious questions arise. Weather events, crop results and basic and longer-range supply chain problems are concerning, as well as new major energy and power problems.
The most pressing economic questions for food producers will be how the ending of federal unemployment bonus checks, the mortgage payment moratorium and weak job growth will affect consumer spending. Cash flow has been boosted with government payments, pushing at least short-term price inflation for many goods and services.
The Bureau of Labor Statistics said total payroll numbers increased by only 235,000 in August, far less than economists had expected. Unemployment declined to 5.2 percent.
Some things can’t be bought at any price, perhaps freeing cash for retail food and foodservice spending.
Foodservice outlets are still operating short-staffed. While the restaurant industry had gradually added jobs all year, that trend ended in August, losing 41,500 jobs. The government said restaurants are now at about 11.3 million jobs, about a million fewer than before the pandemic began in February 2020.
Wages for leisure and hospitality workers are up 10 percent over the last year.
The National Restaurant Association is pushing for more government direct aid to restaurants, particularly independents that have been affected by COVID-19 problems and wage pressures. The industry recently released a survey showing that 19 percent of consumers have stopped dining out entirely because of pandemic concerns.
But, chain sales have remained relatively steady, indicating shifts to takeout and delivery have been making up the difference for bigger operators able to adjust.
Beef demand and boxed beef prices continue strong, and few experts seem to expect consumer spending to ease off soon. How much momentum is out there in an economy no one has experienced before is an open question...
