For the first time, we are able to accurately report the impact – thanks to real-time data provided by Check. - Steven Tadelis, Haas School of Business, UC Berkeley, California
Palo Alto, Calif. (PRWEB) November 27, 2013
Using anonymous and aggregated data provided by Check, the top-rated mobile app that takes the work and worrying out of paying bills, University of California, Berkeley, and University of Michigan, Ann Arbor, researchers were able to determine the impact of October’s government shutdown on consumer spending at national and local levels.
According to the research, anticipating the arrival of the government shutdown, Americans across the nation reduced spending more than a week prior to the event. On a local level – District of Columbia, Virginia and other local regions populated with high amounts of government workers – consumer spending dipped 2x as severely. This, together with the persistence in reduced spending, suggests that local economies suffered economically from the shutdown for significantly longer than the event itself.
Finally, government workers across the nation were the hardest hit group.
- Anticipation around the shutdown triggered Americans across the nation to cut spending by nearly 5% starting in the last 10 days of September.
- Drop continued in October at 2% for the month.
- Local regions with high amounts of government workers cut spending by 10% starting in mid-September.
- Drop continued in October at 5% for the month.
Government Workers - Nationally
- This group slashed spending by 15% starting in the last 10 days of September.
- Drop continued in October at 15% for the month, but rebounded back about 5% per week after the shutdown ended – setting this group significantly behind the rest of the country.
“Despite being short lived, the government shutdown caused a reduction in consumer spending that was felt across the nation,” said Steven Tadelis, associate professor, Haas School of Business, University of California, Berkeley. “For the first time, we are able to accurately report the impact at national and local levels – and for government workers as a group – thanks to real-time data provided by Check.”
Check provided the University of California, Berkeley and University of Michigan, Ann Arbor researchers a sample of anonymous user data from December 4, 2012 to October 31, 2013. The data shows the cumulative change in spending from September 1, 2013 or September 17, 2013 to baseline for all users, for users in DC, Maryland, and Virginia, and for users with Federal paychecks. The baseline spending is calculated using controls for day of month and day of week to take account of how these impact spending. The data set includes 50,787 users across the US, 3,385, users in DC, Maryland, and Virginia, and 709 unique users with Federal paychecks respectively.
Launched in 2008, Check is a leading mobile payments company. Its free, top-rated mobile app is used by nearly 10 million customers to pay bills and track personal finances. For more information, visit Check.me.
Raksha Varma, raksha(at)check(dot)me