Long the bane of churchgoers, sleepy drivers and anyone with an appointment Monday morning, the twice-annual change to our collective clocks could also be striking a blow to the U.S. economy.
The two annual time changes have a net negative effect on consumer spending, according to a report the JPMorgan Chase Institute released Thursday. The finding runs counter to support for the practice from some business groups—including golf courses—that believe an extra hour of after-work daylight during the spring and summer months sparks more spending.
Daylight-saving time was established as energy-saving policy (which has been questioned), not an economic-stimulus device.
The new report confirms U.S. consumer habits may be swayed by sunlight, in some cases. But the reduction in spending when most of the country “falls back” to shift daylight an hour earlier, as will occur this weekend, is larger than the boost in spending that occurs in the spring.
To make that finding, the study pulled from 380 million credit- and debit-card transactions among 2.5 million anonymized Chase customers in Los Angeles and Phoenix. Arizona doesn’t observe daylight saving time, allowing Phoenix to serve as a baseline.
The study found a 0.9% increase in daily card spending per capita in Los Angeles, relative to Phoenix, at the beginning of daylight saving time, and 3.5% decrease at the end of the period. The change in spending is determined by comparing 30 days before the time change to 30 days after.
The fall pullback was most pronounced for goods, especially at grocery stores, gasoline stations and certain other retailers. And the reduction mostly occurred during the week, rather than on the weekend, when consumers have more discretion for when to shop.
Spring-time gains for goods categories were not as large as the fall decline.
Spending on personal and professional services and restaurants swung less significantly around time changes. Diana Farrell, chief executive of the JPMorgan Chase Institute, said that suggests timing for service purchases is more closely tied to appointments or meeting friends than an impulse stop at the store on the way home from work.
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