Consumer Products Rental NAICS 5322

Mar 31, 2025 - Consumer Expectations Hit 12-Year Low

• The Conference Board’s Consumer Confidence Index decreased 7.2 points to 92.9 in March from February. The Present Situation Index—based on consumers’ assessment of current business and labor market conditions— dropped 3.6 points to 134.5. The Expectations Index—based on consumers’ short-term outlook for income, business, and labor market conditions— fell 9.6 points to 65.2, marking the lowest Expectation Index reading in 12 years. Expectations Index readings below 80 can signal a coming recession. Stephanie Guichard, Conference Board Senior Economist of Global Indicators, said, “Consumers’ expectations were especially gloomy, with pessimism about future business conditions deepening and confidence about future employment prospects falling to a 12-year low. Meanwhile, consumers’ optimism about future income—which had held up quite strongly in the past few months—largely vanished, suggesting worries about the economy and labor market have started to spread into consumers’ assessments of their personal situations.”
• The tariff-based trade policies of the Trump administration have the potential to increase the prices of several consumer product rental categories, including appliances, electronics, cell phones, and computers. On March 4, Trump placed 25% tariffs on imports from Canada and Mexico and increased the tariff on all Chinese imports to 20%. Two days later, the Mexico and Canada tariffs were postponed for 30 days for products that comply with the US-Mexico-Canada Agreement (USMCA). The Trump administration has also said widespread “reciprocal” tariffs would go into effect in early April. In 2024, Mexico accounted for 32% of US imports of computer equipment, 10% of communications equipment (including cell phones), 34% of audio and video equipment, and 24% of appliances. Over the same period, China accounted for 28% of US imports of computer equipment, 43% of communications equipment, 25% of audio and video equipment, and 43% of appliances.

• Spending patterns at dollar stores suggest that low-income consumers are tightening their belts, according to The Wall Street Journal. While inflation has slowed and wages have risen for many, some of the country’s lowest wage earners are feeling pinched. Many low-income families were able to build their savings in the years immediately following the pandemic amid stimulus checks, higher demand for blue-collar jobs, and pandemic-era food assistance and child tax credit benefits. However, many low-income workers have spent down their savings. Some dollar stores report that their customers are waiting until the last minute to make event-based purchases, such as holidays, and spending at the end of the month – when lower-income families’ budgets are depleted – has fallen.
• Americans are increasingly opting to rent products instead of buying, either to save money, enjoy greater variety, or have more flexible lifestyles, according to The Wall Street Journal. More than 25% of Americans said they rent or lease their clothing, furniture, car, or electronics, according to a recent survey commissioned by Credit Karma. Amid high inflation, some consumers – many of them Gen Zers - find it more economical to rent items rather than buy. A lack of affordability in the home-buying market has contributed to a stronger rent-first mindset among young Americans, some of whom feel homeownership will likely remain out of their reach. Industry observers say renting day-to-day items has gained popularity as more rental companies have entered the market.