Last week, First Data Corporation released its May 2011 SpendTrend analysis, which studies same-store consumer spending through various payment types at U.S merchant locations.
According to the analysis, while same-store spending volume still grew year-over-year from May 2010, the 6.6% dollar volume growth rate was the slowest in 12 months. In addition, the year-over-year transaction growth rate of 5.1% in the same reporting period marked the slowest rate so far in 2011.
So what does it all mean?
Well, positive growth is still a good thing, even if at a slower rate. If the SpendTrend analysis shows several more months of decreased growth and we start to approach negative growth, it would be a bigger cause for concern.
First Data attributes the slowing growth to lingering economic concerns and high gas prices. According to Silvio Tavares, SVP and Division Manager of First Data Information and Analytics, “High gas prices and stubbornly high unemployment constrained growth in most merchant categories.”
Below are the numbers for May, broken down by transaction type.
Source: First Data Corporation
With the upcoming start of summer and the subsequent flurry of vacation spending upon us, June’s results will paint a more telling picture. If U.S. consumers really are feeling economic concerns now more than they were last year, we should see the growth continue to halt.
If, however, despite high gas prices and lofty unemployment rates the growth starts to pick back up, it will be a positive sign for the remainder of the summer.
We’ll find out more in a month.
Click here for the full SpendTrend analysis release for the month of May 2011 from First Data Corporation.