In 2022, consumers were beset by competing forces. High savings fed by government stimulus vs. high inflation that ate away at both wage gains and savings. Low unemployment vs. the tech hiring freeze and layoffs (sometimes for the first time at some companies). High home values vs. high interest rates. For every one thing that could have helped consumers gain confidence as we entered the “endemic” phase of Covid, there was something else there to bring consumers crashing back down.
As we enter 2023 and try to figure out what consumer behavior is going to be like and how it will impact both retail and the larger economy, it’s worth taking a look at where consumers left off at the end of 2022. Some of those opposing forces are still very much in play, and will continue to shape both consumer confidence and their spending habits. Here are four key questions that will have the most impact on consumer behavior in 2023.
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