Spending on students higher, thanks to Inflation
- Combined spending on the return to school and college is expected to surpass 2021’s record of $108.1 billion.
- Back-to-school spending per child is expected to increase 8{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} from 2021 to an average of $661 per child.
- Compared to the 2021-2022 school year, consumers are bargain shopping, buying more generic products, and making do with last year’s items.
The school year hasn’t officially started for all Americans, but there’s already a lesson learned: We’re spending more on back-to-school shopping.
Students returning to school or college have a host of needs: books and supplies, new clothes and shoes, a computer or other electronics, and, perhaps, furniture and goods to outfit a college dorm room.
Parents are expected to again spend record amounts getting their offspring ready for classes. Compared to a year ago, back-to-school spending is expected to remain somewhat steady at $36.9 billion, a dip of 0.5{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6}, while back-to-college spending will increase an estimated 4{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} to $73.9 billion, according to the National Retail Federation.
Overall, combined spending could reach $110.7 billion, up 2{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} from last year’s record of $108.1 billion, Katherine Cullen, the National Retail Federation’s senior director of industry and consumer insights, told USA TODAY.
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How much will parents spend on back to school this year?
Parents are expected to spend, on average, $661 per child in grades K-12 on back-to-school purchases – 8{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} more than in 2021 ($612) – according to a 2022 Deloitte Back-to-School Survey of 1,200 U.S. parents. Pre-pandemic spending per child was $519 in 2019, the firm found.
In another measure of back-to-school spending, the National Retail Federation estimates households will spend an average of $864 for the 2022-2023 K-12 school year, up nearly 2{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} over the $849 spent in 2021, according to a survey of 7,830 consumers, conducted by the federation and market data company Prosper Insights & Analytics.
Household back-to-college spending of $1,199 per household is stable, compared to $1,200 spent last year, the survey found.
How will inflation impact back-to-school spending?
Inflation has declined after hitting a 40-year-high of 9.1{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} in June; in July, consumer prices were up 8.5{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6}, compared to a year ago.
Consumers had been concerned about inflation driving higher prices for back-to-school spending, but they still expected to spend 40.6{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} more than in 2019 for back-to-school and 35.5{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} more on back-to-college spending, the retail federation survey found.
“Higher prices and inflation are very much top of mind for this year’s consumers,” Cullen said during a July 20 presentation on YouTube.
More than two-thirds (68{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6}) of shoppers had seen higher prices for clothing and accessories, school supplies, shoes, electronics and furniture, the retail federation survey found.
Back-to-school items were priced, on average, 15{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} higher than a year ago, according to retail analytics firm DataWeave. Among the supplies that have seen a price bump, per the firm:
- Backpack prices are up nearly 12{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} to an average of $70.
- Lunch boxes have risen 14{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} to more than $25.
- Notebooks and folders, up 31{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} to $3.74.
Office supplies have seen some of the highest increases among consumer products, according to consumer data company Klover. Examples: Prices for Scotch tape and Sharpies have increased more than 50{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} over last year.
Sydnie Bryant, a single self-employed mom in Sarasota, Florida, said she shopped online and at Dollar Tree for her sixth and eighth graders.
“For me, the hard part right now isn’t that school supplies are so much more but that everything else is so much more,” she said. “My kids and I live in a one-bedroom apartment because pay hasn’t caught up with cost of living. We will figure it out but that is the balancing act single parents are doing right now.”
“People are dealing with higher grocery and gas prices and for back to school, which means you’re really going to have to budget because this is typically the second largest spending event for families in a year behind what they spend for holiday,” Lupine Skelly, Deloitte’s retail research leader, said in a July 14 Deloitte Insights podcast.
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That need to budget may have contributed to more than half (56{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6}) of shoppers beginning their return-to-school purchases by early July, up from 51{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} in 2021 and 52{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} in 2020, the retail federation found.
Compared to last year, shoppers said they were frequenting sales more often, doing more comparative shopping online, buying more store brand and generic products, and making do with last year’s school items, Cullen said.
“Consumers are also doing other things,” she said during the presentation. “They’re working overtime or taking on additional hours. And they’re also using some different payment methods like buy now, pay later, which can be a way of spreading out some of the costs.”
For growing kids and teens, an ever-evolving wardrobe
Summer vacation was forgone in favor of smaller weekend getaways to help offset back-to-school spending for her daughters, ages 11 and 14, said Barbie Simonson of Rock Hill, South Carolina.
Sales, clearance racks and church giveaways helped them get more clothing for their money, she said. Her daughter entering high school, “needed a whole new wardrobe, as her middle school required uniforms. That meant at least seven or eight full outfits that a teenager would be happy to wear. Even with coupons, back-to-school sales and tax-free weekends, I still spent over $700 just on new clothes and shoes for her,” Simonson said.
“Last year, I could find a decent outfit for about $50-$75 that a teen would be happy wearing. Today? I struggled to get under $100 for most outfits and accessories.”
Her younger daughter is “growing so fast that this will be the third time this year we have replaced her wardrobe,” Simonson said. “She is still in elementary school, so I can get away with Target, Old Navy and the like. Crocs are the ONLY shoe she will wear and you can’t find them under $60 anymore.”
Mass merchant stores will get the bulk (49{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6}) of their business, shoppers said in the Deloitte survey. But online-only sites have become a more frequented destination, getting an estimated 16{5b4d37f3b561c14bd186647c61229400cd4722d6fb37730c64ddff077a6b66c6} of spending. Department stores, fast fashion apparel retailers, specialty clothing stores and dollar stores round out the spending choices.
Even though inflation concerns may have abated somewhat, “they still exist for consumers,” Stephen Rogers, managing director of Deloitte’s consumer industry center, told USA TODAY. “Parents will prioritize this and make it happen for kids this back-to-school season.”
Still have some back-to-school shopping to do? Rogers has a tip. “Retailers may begin to discount inventory as we move toward September.”
Follow Mike Snider on Twitter: @mikesnider.
