Tonight:
9°c
Sofa sales: the true indicator of recovery
Lucy Tobin16.04.09
Sofa sales will be the first sign that the economy is on the up, according to a report by economists.
Analysts at Capital Economics have researched spending patterns of past recessions and concluded that sales of furniture and household appliances are the first to turn the corner in a downturn.
"Just because different areas of spending have behaved in a certain way in the past does not mean they will continue to do so, but the sheer speed with which the housing market adjustment is taking place suggests that household goods sales may once again be one of the first sectors to recover," said Vicky Redwood, an economist at Capital.
Purchases like cars are also earmarked for a boost in sales "relatively early on" in the recovery, while luxuries such as gym membership are more likely to lag.
Eating out, once considered a luxury, is now a "relative necessity" according to Capital, and diners are also likely to return to restaurants earlier than in previous downturns.
However, the economists added that, by the end of the recession, total household goods sales will be down more than 20% car sales are expected to be down by a third.
