On Tuesday, Wall Street opened flat amid economic recovery worries. Many are concerned that the economy is slowing down, thanks to countless new data focused on the labor market, consumer demand, and overall business activity in the last few months. Consistent problems — such as the labor and material shortages, as well as global supply chain bottlenecks — may also be to blame for this flat open.
The Dow Jones Industrial Average (.DJI) rose about 4.15 points or 0.01% on Tuesday’s opening to 35,373.24. The S&P 500 (.SPX) opened lower than before by 0.05 points (0.00%) at 4,535.38. Finally, the Nasdaq Composite (.IXIC) actually gained 12.47 points at opening (0.08%) at 15,375.98.
Economists, investors, and consumers are currently concerned about the future of the economy. Concerns have risen for a number of reasons. For one, the United States is still struggling to deal with labor shortages. Around the nation, there are many businesses that are struggling to meet consumer demand because they don’t have enough people working.
Many economists initially thought that people would return to work this fall as students returned to school. Childcare has become a major issue in the nation, as the lack of workers in childcare facilities has left many families unable to have anyone watch their child. As a result, they have been kept from returning to the workforce. While many analysts assumed people would return to the workforce in August, however, this didn’t happen. Payroll additions slowed down immensely in August when compared to July.
This is possibly because of the Delta variant of COVID-19, which has caused infections and cases to surge nationwide. The Delta variant has also kept consumers from feeling optimistic about the economy, and there are many signs that consumer demand and activity is now slowing down as a result of the growing number of Delta cases.
However, even amid these negatives, there are positives to be found. For example, retail sales seem to have surged in the few weeks, thanks to the back-to-school season. While there is no official data yet to analyze, companies such as Walmart and Target have already told their investors that the back-to-school season has done quite well for them. As a result, retail sales are expected to surge for the third quarter.
This surge comes amid faltering retail sales experienced for the last few months. While clothing and fashion sales have consistently done well in the United States, the sale of other retail goods has faltered as consumer demand switched from goods to services. However, the back-to-school sales possibly did so well because consumers had extra cash on hand, thanks to early child tax credits and previous stimulus checks.
The back-to-school season is watched closely by economists and analysts, as it tends to signal how the holiday season, one of the most important times of the year, will go for businesses. So, even with these many negatives, there still are some positives that could help the economic recovery until the end of the year.