1.0Liberty Street Economicshttps://libertystreeteconomics.newyorkfed.orgblog authorhttps://libertystreeteconomics.newyorkfed.org/author/blog-author/Discretionary and Nondiscretionary Services Expenditures during the COVID-19 Recession - Liberty Street Economicsrich600338<blockquote class="wp-embedded-content" data-secret="qdHhKmVDjk"><a href="https://libertystreeteconomics.newyorkfed.org/2021/01/discretionary-and-nondiscretionary-services-expenditures-during-the-covid-19-recession/">Discretionary and Nondiscretionary Services Expenditures during the COVID‑19 Recession</a></blockquote><iframe sandbox="allow-scripts" security="restricted" src="https://libertystreeteconomics.newyorkfed.org/2021/01/discretionary-and-nondiscretionary-services-expenditures-during-the-covid-19-recession/embed/#?secret=qdHhKmVDjk" width="600" height="338" title="“Discretionary and Nondiscretionary Services Expenditures during the COVID‑19 Recession” — Liberty Street Economics" data-secret="qdHhKmVDjk" frameborder="0" marginwidth="0" marginheight="0" scrolling="no" class="wp-embedded-content"></iframe><script>
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https://libertystreeteconomics.newyorkfed.org/wp-content/uploads/sites/2/2021/01/6a01348793456c970c0263e987e7fd200b-500wi.jpg500313The coronavirus pandemic and the various measures to address it have led to unprecedented convulsions to the U.S. and global economies. In this post, I examine those extraordinary impacts through the lens of personal consumption expenditures on discretionary and nondiscretionary services, a framework I developed in a 2011 post (and subsequently employed in 2012, 2014, and 2017). In particular, I show that there were exceptional declines in both services categories during the spring; their recoveries, however, have displayed notably different patterns in recent months, with nondiscretionary services expenditures nearly back to their prior level and discretionary services expenditures seemingly stalled well below their pre-pandemic peak.