Since mid-market department store sales reached their retail peaks in January of 2001, they have been steadily heading downhill. Unfortunately the middle-class has been heading downhill as well.
Are these two realities related?
Look at Sears. It got its start with $14 gold pocket watches, which sold like hotcakes due to the railroads and the newfangled time zones. Richard Sears took his growing company from the eventual 1893 Sears Roebuck catalog (Alvah Roebuck being his watch repairman) to its first department store in 1925. This led to Sears becoming the ubiquitous store anchor in shopping malls around the country.
It seems like everyone has shopped at Sears over the years. Every single appliance in my home has come from Sears. They sold durable products and even offered easy-in credit lines to help move their products.
Sears was specifically designed for the middle-class. But low-market big-box stores like Wal-Mart have been at least partially blamed for 300 store closures since 2010. Mid-market is no place to be, as Sears continues to find out.
An advertisement recently came in the mail from a Kitsap area appliance store showing huge high-end, restaurant-quality appliances — gorgeous, showy and totally unnecessary. Yet these appliances evidently sell.
The top 5 percent of American earners spent nearly 40 percent of all personal expenditures in 2012, according to the Institute for New Economic Thinking. Responding to this, retail and service industries, who can, are going after big spenders with high-end goods and services.
The top 10 percent in 2012 received half of all reported income, reports the Los Angeles Times. The top 1 percent of that 10 percent receives half of that income – and the top 0.1 percent of that 1 percent received half of that.
This 0.1 percent, supposedly a mere 16,000 Americans, each make at least $10 million dollars per year. These are the spenders who donate to political causes and determine our market structure, and so keep the playing field anything but level.
A new aggregate limit of $3.5 million has been offered up to the politically-motivated rich. The prior aggregate limits of $123,200 has been judicially declared a violation of the First Amendment. According to the recent decision of the US Supreme Court in McCutcheon v. Federal Election Commission, money equals speech.
And we’re supposed to believe that what trickles down can get the economy moving again.
Today, 13 million Americans have reached working age since Wall Street’s December 2007 unregulated fit of greed hit the fan. Yet only one quarter of the jobs created in the past three years have been mid-level. And the number of full-time workers still lags behind what it was before the recession, which began in 2008.
Mid-market department stores are probably never going to come back as they were, nor, as many believe, will the middle class.
Brick-and-mortar stores at both ends of the economic spectrum have felt the effects of the internet as it takes their share of the pie. Even low-end giants like Wal-Mart and high-end giants like Nordstrom’s must keep up their revenue — and the changing shopping habits of their customers — by increasing online sales.
Likewise, there is an urgency for the 90 percent to open a dialogue in order to take back “work hard, play by the rules and you’ll get ahead,” and breathe fresh air into it. If we don’t, the growing gap between the “have nots” and the “have mores” will continue chipping away at our society.
—Marylin Olds is an opinion columnist who may be reached at marylin.olds@gmail.com.
