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This Year, Teen Chic is Cheap
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Leannie Lukin, 19, has no trouble pinpointing where she has cut back her spending this summer.
"Shopping," Lukin says, without hesitation. "I have enough clothes. At this point it's definitely more of a want than a need."
Lukin, who has been a longtime fan of brands like J. Crew and Polo Ralph Lauren [RL
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], has had to become a savvier shopper. Now, when shopping in her hometown near Albany or at school in Poughkeepsie, New York, she heads for the discount racks first, explores cheaper alternatives like American Eagle, or skips the trip to the mall altogether.
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Wary of high gas prices, Lukin made the 90-minute drive home from the camp where she worked this summer only twice. But fuel still managed to cut into her cash; to compensate, she has started eating out less.
Lukin is not alone. Teens across the nation have spent their summer vacations battling high gas prices, competing for jobs in a weak part-time employment market, and making do with smaller contributions from cost-conscious parents.
All of which has led teenagers, in the past considered "recession-proof" spenders, to confront the impact of a slowing economy. According to a survey conducted by BIGresearch in July, 60 percent of teenagers said they had become more frugal in the last six months—compared with only 50 percent of adults.
"Unequivocally, teen spending is very weak," says Adrienne Tennant, a senior analyst at Friedman, Billings, Ramsey. "Usually teens are a resilient portion of the economy because all spending is discretionary, but this time around, gas prices are clearly eating up budgets."
As young adults are forced to make spending trade-offs, it's provided a window into their priorities. The takeaway? Clothing, once the sinkhole of teen pocket money, is losing its allure.
In April, Piper Jaffray released a semi-annual survey of teens that said that teen spending on fashion was down a whopping 20 percent from a year earlier.
By August, major teen retailer Abercrombie & Fitch [ANF
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] saw its same-store sales fall 11 percent, and American Eagle ended the month down 5 percent. Pacific Sunwear saw a 6 percent drop for the month, while Limited Brands [LTD
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] fell 7 percent. Comparable store sales at Gap [GPS
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]decreased by 8 percent.
Retailers tend to count on a big boost in August when high school and college students restock their wardrobes for the fall, but this year, that lift hasn't materialized. Teenagers are trading down to less expensive retailers, buying fewer items, and waiting for sales and bargains.
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Data is a real-time snapshot *Data is delayed at least 15 minutes
