Economists are watching consumer spending for signs of a slowdown.
Carl Bonham, executive director of the University of Hawaii’s Bureau of Economic Research, says the economy is still in relatively good shape – but inflation remains the biggest threat.
“The economy is holding up reasonably well despite headwinds from higher inflation and the continued lack of Japanese visitors,” he said. “And so when you pull it all together, you have a little bit more worrying about the fall and into 2023, more slowdown, a little less job growth, a little bit more unemployment, less visitors as the US economy is slowing down — and we have to.” nor see the recovery of the Japanese visitors, as I said.
“And then there’s the real challenge, because of inflation, people basically have to cut back on spending,” Bonham told HPR.
Bonham says that for those with household incomes in the bottom 20% of the state, inflation this spring took a 9% tax off their income.
That means these folks have to pay 9% more or several thousand dollars to keep up their current expenses.
This interview aired on The Conversation on July 21, 2022. The Conversation airs weekdays at 11am on HPR-1.
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