by Brittany Raymer
Former Digital Writer & Editor
Target, one of the nation’s largest retailers, reported that profits plunged 90% in the second quarter. With the exception of Walmart, other retailers announced similar losses. It’s another sign that despite some media reports and optimistic commentators, the economic downturn is coming as consumers are already adjusting spending amid recession fears.
As one of the nation’s most popular retailers, Target is a staple when it comes to finding cheap and affordable fashion, toys, electronics and various household items, but the retailer has hit a fairly severe slump this quarter. According to reports, earnings fell to $183 million from a high of $1.8 billion during the same time period last year.
This is the second straight quarter of negative earnings, after seven quarters of strong growth.
It’s not the only retailer struggling. TJ Maxx, which also owns Home Goods and Marshalls, also posted disappointing numbers.
Walmart fared better, though many believe this is due to its additional focus on groceries. Target does sell food, but it primarily focuses on customers discretionary spending. It’s even had to decrease the price of items to get rid of the surplus.
Though some of the other economic indicators for the country are good , like job growth and the decrease in gas prices, most are troubling.
The housing market has also cooled significantly, with the Wall Street Journal reporting home sales falling for the sixth straight month in July. Builders are also reconsidering construction projects, after a fevered pace that saw a housing boom at the midpoint of the pandemic.
It seems more and more evident that the country is heading into an economic downturn and likely recession, no matter what the White House says.
The people of North Carolina agree.
In the latest Civitas Poll conducted by the John Locke Foundation, 46.9% of respondents “strongly agree” and 19.4% “somewhat agree” that the country is currently in a recession.
A survey conducted by Stifel Financial of 70 business leaders determined that 18% believe we’re already in a recession or will face one within the next 18 months (79%). An optimistic 3% seem to think it can be avoided entirely.
The prospect of another recession has many Americans worried, and the latest numbers from Target and other retailers show that consumers are already adjusting their purchasing practices in anticipation of likely economic hardship.