Home New mexico economy NMSU Economics Professor: Don’t Wait To Shop For The Holidays

NMSU Economics Professor: Don’t Wait To Shop For The Holidays

7
0

LAS CRUCES, New Mexico (KTSM) – As the holidays approach, an economics professor at New Mexico State University insists now is the time to buy gifts.

Christopher Erickson, head of the economics, applied statistics and international trade department at NMSU, urged consumers not to wait for holiday shopping this year and warned that customers could face fewer products at prices higher in stores due to a tight supply chain.

“There is a shortage of products on the shelves, so it is difficult to find products. And the products there will not be offered for sale. If you are shopping for Christmas, you will want to buy early.

Christopher Erickson, Professor of Economics at NMSU

Erickson said the pandemic was fueling disruptions in the global supply chain.

Supply chain disruptions have hit the United States and other major supplier countries the United States relies on for their products hard, including China, Erickson said. The shortage of goods on the shelves, he added, is also causing a second problem: inflation.

“We’ve seen inflation, and that inflation is mostly due to supply chain disruptions in the economy,” Erickson said.

The pandemic has also deeply affected employment in various industries, according to Erickson. One of the problems hampering economic recovery in the United States is the shortage of workers resulting from individuals who lost their jobs at the start of the pandemic but have not yet sought re-employment.

Nationally, employment remains 3% below its peak before the pandemic began, according to Erickson. That number is double in New Mexico, he added.

“This disruption in employment has ripple effects,” Erickson explained, “because if you don’t have people working in factories, you don’t have products in production.”

Christoper Erickson, Professor of Economics at NMSU

Erickson cited several reasons for the worker shortages. People with children, for example, are reluctant to re-enter the workforce because of limited childcare resources. Others, Erickson said, abstain from work simply for fear of contracting COVID-19.

Low wages could also be a major factor, Erickson said.

“At the end of the day, if employers are willing to pay more, they’ll get more workers,” Erickson said. “One of the problems you have is that labor markets are very slow to adjust. And that has been, and is, what drives the business cycle. “

Erickson said there was little to no evidence that extended unemployment benefits had prompted people to return to work.

“It seems to be correct, but the evidence just isn’t there,” Erickson said. “A number of states have prematurely ended their extended unemployment benefit programs. In these states, compared to other states, there does not appear to be any real difference in the return of workers to their jobs. “

Erickson said supply chain bottlenecks can devastate small businesses. Large retailers, such as Walmart, have more resources to weather disruption, Erickson explained, and pay higher prices to ensure their products are transported and unloaded as quickly as possible.

“Historically, it was unheard of for a company like Walmart to rent their own ships for transportation, but now they do. The reason they are doing it is because they want to make sure they have products for Christmas. Small retailers cannot do this and are at a competitive disadvantage because of it.

Christoper Erickson, Professor of Economics at NMSU

Erickson said the destructive economic effects of the pandemic could continue until COVID-19 is brought under control, but expects supply chain issues to be resolved in the coming months, but not in time for the holidays.

“I’ll tell you that I took my own advice,” Erickson said. “Between my wife and I we have seven grandchildren and we have already done our Christmas shopping for them.”

Erickson suggests buying a wider variety of products online rather than buying in-store.

“There are always things you can find online that you can’t find locally, but that might be truer this Christmas than usual.”

Christopher Erickson, Professor of Economics at NMSU

For local and breaking news, sports, weather alerts, videos and more, download the FREE KTSM 9 News app from the Apple App Store or the Google play store.