So-so port traffic an indicator of a slow holiday season?

backtoschool.jpgThis is normally the time when huge shipments are coming into the Ports of Los Angeles and Long Beach, both for the back-to-school and holiday shopping seasons. Indeed, L.A. had more import traffic in July than any other month this year. But the comparison with a year ago was modest - a 3.97 percent increase in imports. Long Beach import traffic was down 10 percent (though some of that might be due to the loss of a large tenant). August is expected to be better, according to a report prepared by Hackett Associates for the National Retail Federation. Import cargo volume at the nation's major ports - including L.A. and Long Beach - are projected to increase by 6.3 percent from a year earlier. "Indicators are mixed, and analysts are getting nervous and expecting the U.S. consumer to retrench and reduce consumption," Hackett Associates founder Ben Hackett said. "But we continue to believe that trade will not weaken as much as expected by others." With school starting so early this year, analysts should get a good sense of consumer spending, which of course is the biggest part of the U.S. economy. So far, so good, at least judging by a better-than-expected increase in July retail sales. Still, wage gains have been meager and many folks continue to pare down debt. So you have two forces on a collision course. NPR's Marilyn Geewax adds this:

There's another reason for retailers to be hopeful: simple math. Schools are adding lots more students this year. That's because the country saw a population boom from 2003 to 2007. In that peak year of 2007, about 4.3 million babies were born -- up from 4 million born in 2002. This baby boom coincided with the housing boom. As people were moving into bigger houses before the mortgage crisis hit, they were having more babies to fill up those new bedrooms. Now, their children are entering kindergarten and grade school. As a result, back-to-school spending is expected to rise this year by 14 percent, to about $689 per family for clothes and goods including electronics, according to the National Retail Federation, the biggest trade group for merchants. That would be the fastest pace of growth since the survey began in 2003.

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
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