What Health Clubs and Acupuncture Tell Us About the Economy
Despite an economy that may have entered a soft patch, Americans are still beating a path to their health clubs, acupuncturists and spas.
Every month here at AIER, we conduct an exercise where we strip out the expenses people pay every month that remain constant, like mortgage payments, to give a closer look at those things people buy more frequently. Our Everyday Price Index for January shows a 1.5 percent drop in prices, mainly due to the impact of lower energy prices, such as gasoline. That’s a bigger drop in prices than we saw with the Consumer Price Index, released by the Labor Department yesterday, which registered a drop of 0.7 percent.
You might think lower prices would signal sluggish demand, and certainly the strong dollar and higher productivity are exerting downward pressure on the price of goods. But as our senior research analyst Theodore Cangero notes, services are a notable counterweight. Prices at health clubs increased 1.4 percent in January, and prices of personal care services, like acupuncture, massage and spas, are up 1.2 percent.
This may reflect the trend towards being more health conscious, but Cangero also notes that these services can be among the first to go when people are out of work or feel unsure of their job security. Higher prices for gym memberships and such may reflect higher confidence in the labor market, he said.