Study: More than half of Americans struggle to afford the basics

New York City -- A study released Thursday by WSL/Strategic Retail found that 52% of Americans are struggling to afford the necessities, and for many even that is a stretch.



The “How America Shops MegaTrends report, Moving On 2012,” revealed among its significant findings that the youth market, 18-34 year olds, has the highest percent of those who do not have enough money to cover their basic needs, with close to a quarter (24%) in financial turmoil.



Compared with people over 35, who were able to launch their careers 10 years ago, this group is a long way from recovery, compelling retailers targeting this group to seriously rethink their strategies, according to WSL.





The study also found that branded products may be threatened, as shoppers are placing greater focus on price. Two-thirds (67%) of women said that trusted brand names are not worth paying more for. More than a quarter (26%) admit that while they used to buy brand names they could not afford, they are no longer giving in to this indulgence. This figure is up seven percentage points from 2010.



Nearly 30% of Americans in the $100-$150K income bracket claim they can only afford the basics. Once considered affluent, six-figure income shoppers are now identifying themselves as middle-income.



“There is a huge fundamental issue when more than half of Americans can only afford basic necessities and people who earn up to $150,000 think they are poor,” said Wendy Liebmann, CEO of WSL Strategic Retail. “American shoppers are moving on and coming back to shopping, but at their own pace. As a result, retail sales are precarious and likely to fluctuate up one month, down the next. That’s not going to change any time soon.”



Among other findings, 75% of women now say it’s important to get the lowest price on everything they buy, up 12 percentage points from 2008 and up 22 percentage points from 2004. Methods to lower price include couponing, buying only on-sale items and searching online for discounts before shopping brick-and-mortar stores.