Memorial Day Impact on the Economy
As the end of the school year begins to rapidly approach, many students are looking forward to their last day off of school before they start cramming for finals, or preparing for graduation. Memorial day kicks off the summer season and is a day that most spend barbequing, or on the lake. Typically families will be packing and heading up north for the first time of the summer. However, for people who chose to stay in town they can enjoy their weekend shopping some of the biggest sales of the year. Either way this long weekend provides a small boost to the economy before kicking off the booming business of the summer.
Both large business and small business economies will be impacted from just this long weekend. Many companies will be advertising large sales, hoping to generate a surplus of profits, while other companies will benefit just as a positive externality from consumers actions.
It is expected that people who are going out of the town for the holiday will travel a minimum of 50 miles and that overall traveling revenue will bring in upwards of 12 billion dollars.(247wallst.com)(moneyinc.com). This means consumers will increase their spending on gas, but also snacks and other miscellaneous necessities for road trips. Once consumers reach their destination, purchases on barbecuing supplies, meats, and gasoline to power boats will also increase. Gasoline alone is projected to bring in 1.4 billion dollars over this small four day period, showing just how easily this weekend can affect our economy(ucsusa.org). Surveys shows that around 62% of the population will spend their memorial day barbecuing, meaning that profits from meat, sides, and grill supplies will increase(wallethub.com).
For people who stay in town during the long weekend there are still plenty of ways for them to contribute to the spending. Knowing that sales from almost every store will be in effect this weekend, it encourages consumers to postpone buying products, with the expectations of future price decreases. Clothing stores are expected to have sales ranging anywhere from 20%-90% with extra coupons that can be added on top of that to make the opportunity cost of missing the up north trip, even more favorable for some(Dealnews.com). Homegood stores are also expected to have sales ranging from 30%-50%, increasing the quantity demanded for their products; and their revenue(Dealnews.com).
Besides increasing consumer spending, Memorial day weekend is the first chance of the summer to lower seasonal unemployment. Workers will be in high demand over this weekend for several different reasons. Many employees will want the long weekend off to party, or spend with family, but in order for companies to give workers off they need employees willing to work, creating more jobs. Employees for summer businesses will also be needed as this is the “first weekend” of summer for many. Those going up north will visit ice cream stands or small bait shops, all of which require summer employees and thus will decrease unemployment.
Overall although Memorial day weekend is a relatively short weekend, it has a large economic impact. Many companies will bring in an increase in revenue, and employers will also be hiring, helping us to reach our goal of full employment. All of this put together works to boost the economy and better its health.
Berr, Jonathan. "Six Reasons The American Economy Needs Memorial Day." 247wallst.com. 24/7 Wall St, 30 May 2011. Web. 15 May 2017.
"Infographic: Memorial Day - The $1.4 Billion Weekend." Union of Concerned Scientists. Union of Concerned Scientists, n.d. Web. 15 May 2017.
Kiernan, John S. "Memorial Day 2016 by the Numbers." WalletHub. Wallethub, 23 May 2016. Web. 15 May 2017.
Ramhold, Julie. "What to Expect From 2017 Memorial Day Sales." Dealnews. DealNews, 15 May 2017. Web. 15 May 2017.
"Memorial Day Travel Forecast Archives." AAA NewsRoom. N.p., n.d. Web. 15 May 2017.