Yahoo Finance Walmart CEO: The lack of stimulus is taking its toll
Attention lawmakers: get a new stimulus done now, because your dillydallying is hurting U.S. consumers and businesses.
“I think the lack of stimulus is showing up more so with those unemployed, small businesses and people that need help. I think it’s important that we all understand in some ways we are having a shared experience because we are in a pandemic together, but we are having a very different experience. If you have been let go and don’t have income, you really need help. The voice we have at Walmart is to say to Congress and the administration we need you to help those people who need help,” Walmart CEO Doug McMillon said at the Yahoo Finance All Markets Summit.
Stimulus from the Coronavirus Aid, Relief, and Economic Security Act (CARES) Act in the form of an unemployment payment top up and direct checks to people greatly helped Walmart and the broader retail sector in the spring.
Walmart’s U.S. same-store sales surged 9.3% in the second quarter, led by general merchandise and food. Rivals such as Target, Kroger and Albertson’s also saw outsized quarterly sales gains. But consumer spending slowed down into September — and now into October — as stimulus has run its course. The lack of stimulus —and any insight into when a new deal will get passed amid a contentious election season —stands to highlight the struggles of lower income Americans in coming months.
Among lower-income Americans, a recent Pew Research study showed that 46% surveyed had trouble paying their bills since the pandemic began. Roughly one-third have had difficulty making rent or mortgage payments.
The financial stress stems from how the pandemic has uprooted the U.S. economy, leading to sweeping layoffs. Pew found that 25% of adults say they or someone in their household was laid off or lost a job due to the pandemic. Roughly 15% said job loss happened to them personally.
Despite the economic uncertainty, McMillon is hopeful on the crucial holiday shopping season.
“I think people want to celebrate the holiday. Hopefully families will take steps to do that in a safe manner. But we all need some love and joy, and this time of year brings those things top of mind. We’ll find a way to celebrate it and it will be a good year. It will be unique, but a good year,” says McMillon.
Brian Sozzi is an editor-at-large and co-anchor of The First Trade at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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