Friday, December 14, 2018

US Retailers Feeling the Effects of Immigration Worries by Hispanic Spending

New Hispanic trends indicate Hispanics are cutting back on spending and buying only essential goods in response to harassment by immigration or law enforcement officials. Already-struggling consumer companies have cited this change in consumer behavior by the country’s-fastest-growing ethnic group as a cause for worry.

In late July, Target Chief Executive Brian Cornell at a conference referenced a report by retail consultants NPD Group that cited a decline in discretionary spending by Hispanics. “They are staying home. They are going out less often, particularly around border towns in the United States,” Cornell said at a conference in Aspen, Colorado.

The two sectors feeling the most pressure, and hurting the most, are apparel and footwear; the slowdown in Hispanic consumer traffic has mainly hit discretionary spending. Trump’s election in November came after a series of campaign promises to deport undocumented foreigners and build a wall with the border to Mexico, so it’s no surprise that American Hispanics are outraged and changing their behavior, particularly when it comes to consumer habits.

“For our own president to call us criminals, thieves and rapists — it’s terrible … we live in fear of doing those simple things like going for groceries,” said a 19-year-old Chicago college student, Juan F., who did not want his full name used out of concern for family members who are undocumented.

The rapid change in consumer habits is being attributed to the “Trump effect,” and with a buying power that is undeniable, their impact on the retail industry is being felt profoundly. From changes in foot traffic to actual purchases, the retail industry is feeling the consequences of an anti-immigrant rhetoric.

CNBC News