May 22, 2009
CNN Money.com
With shopping no longer their favorite pastime, Americans appear to be spending their money in other ways, such as acquiring new skills, getting help with their finances and visiting the dentist.
This change in spending behavior is helping trade schools, accounting firms and even your neighborhood dentist survive the economic downturn better than other businesses, according to an industry report.
"Our data show that companies selling non-discretionary products and services, things that people really need, are doing pretty well," said Brian Hamilton, CEO of Sageworks Inc., a Raleigh, N.C.-based company that analyzes weekly financial data such as sales, balance sheets and income statements for privately held companies across 1,600 industries.
Hamilton said seven industries are clearly benefiting from a pickup in sales over the past 12 months.
This change in spending behavior is helping trade schools, accounting firms and even your neighborhood dentist survive the economic downturn better than other businesses, according to an industry report.
"Our data show that companies selling non-discretionary products and services, things that people really need, are doing pretty well," said Brian Hamilton, CEO of Sageworks Inc., a Raleigh, N.C.-based company that analyzes weekly financial data such as sales, balance sheets and income statements for privately held companies across 1,600 industries.
Hamilton said seven industries are clearly benefiting from a pickup in sales over the past 12 months.
Auto Repairs, Home Repairs
April's retail sales numbers showed consumers are still shunning big-ticket purchases. So instead of buying new cars or upgrading to bigger homes, they are spending money on maintaining what they already own.
Auto repair shop sales grew 2.4% over the last 12 months while car dealership sales declined by 9.7%, according to Sageworks.
As more people remodel and fix their homes instead of moving, revenue for electricians, plumbing and heating contractors has grown 4.6% in the last 12 months while home builders' sales declined by more than 5%.
Supermarkets
Many consumers are looking to save money by eating at home more than eating out. This trend has favored grocery stores, resulting in a 6.7% sales increase for supermarkets in the last 12 months.
By comparison, Sageworks' data showed family-style restaurants logged a slower 3.9% sales increase.
Trade Schools
With an average of 600,000 Americans losing their jobs every month, many are going back to school to learn new skills and improve their chances of rejoining the workforce when the economy rebounds.
Revenue at trade and technical schools has grown by 9.1% in the last 12 months, a faster pace than the 5.9% growth in 2007.
Dentists' Delight
Hamilton said health care has been one of the most recession-resistant sectors, since people regard it as a necessity.
Sageworks' data showed the average dentists' office logged sales growth of 6.9% in the last 12 months, up from 4.9% in 2007.
Looking Good
Personal care extends to looking good through the recession. While Americans may be making concessions on high-end services, they are still getting regular haircuts and manicures.
Hair salons, barber shops, nail salons and spas logged sales growth of 4.5% in the last 12 months, according to Sageworks.
Help With Finances
Many consumers aren't shying away from paying for financial advice to help them make it through the recession.
Sageworks' data showed that the accounting industry ranked among the top 10 industries in terms of revenue growth, with a 10.2% gain in the past 12 months.
"These patterns show that the recession has been lopsided," said Hamilton. "Although the economy has slumped, we're not getting a decline across all industries. Very specific industries like real estate are creating a big drag on the broader economy."
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