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Wisconsin IDEA
Insight • Data • Economics • Analysis
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Net Savings Trends and Their Impact on the U.S. Economy
How Savings Rates Drive Investment, Stability, and Future Prosperity
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Total U.S. net savings as a percent of Gross Domestic Income (GDI) [1] has averaged 6.3 percent over the period from 1947 to the first quarter of 2024. There are, however, notable differences over that period. Throughout the 1950s and into the 1960s, the average annual net savings as a share of GDI was 10.7 percent. From 1970 to 1990, the average was 7.0 percent, but from 1990 to 2024 (first quarter), the share dropped to 2.7 percent. More recently, from 2002 to 2024, the average share was 1.8 percent, and nearly one in five quarters saw negative net savings as a percent of GDI. The most noticeable “negative savings” was spurred by the Great Recession and the last five quarters (2023 and the start of 2024).
At the same time, the overall level of net savings (annualized) has been increasing. Since 1990, the average annual net savings has been $337.3 billion, with noticeable dips during the Great Recession and the immediate start of the COVID-19 recession. These periods make sense as economic agents (households and businesses) drew down savings to make up for lost income. More concerning is the drawdown in savings over the past five quarters, suggesting that total net savings have not kept pace with overall growth in GDI and is moving in the wrong direction.
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Econ Quiz: Back to School
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Get your backpacks ready, Econ Quiz readers. The school year is here, and this week’s quiz focuses on the annual back-to-school bump in retail sales.
Back-to-school spending continues to grow each year. According to the National Retail Federation the average household spent $697 on back-to-school items in 2019, jumping to $849 in 2021, and $890 in 2023, for a market total of $41.5 billion in the 2023-24 school year. Parents use a variety of strategies to keep spending in check. The market research firm Mintel surveyed 1,906 parents of K-12 students and found that 18% bought fewer new items, and 21% re-used more items, in 2023 than they did in 2022. Half of parents reported that they compare prices, look for sales (50%), shop sales for most items (48%), purchase store brands (30%), shop on tax-free holidays (30%), or switched to a lower-cost retailer (26%). Despite these strategies, 36% reported spending more on back-to-school shopping in 2023 than in the previous year.
That brings us to today’s question. Electronics accounted for roughly $15.2 billion of the $41.5 billion spent on back-to-school items last year. To make the Econ Quiz honor roll, how much did the average family spend on electronics alone for their K-12 student in 2023? For extra credit, how much was spent on traditional school supplies, such as pencils, notebooks, and glue sticks?
A. $325.96
B. $257.12
C. $201.87
D. $166.59
E. $140.39
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Want to Host the 2025 Connecting Entrepreneurial Communities Conference?
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Accepting Applications Now
Wisconsin’s first Connecting Entrepreneurial Communities (CEC) Conference hosted over 200 people with over 60+ speakers and 10 local vendors. Interested in bringing this event to your own Wisconsin town? Host applications for CEC in 2025 are due September 15.
About the Conference
The Connecting Entrepreneurial Communities conference hosts a statewide conversation about how to promote entrepreneurship in Wisconsin’s small and rural communities. It gathers business owners, municipal leaders, financial lenders, economic development professionals, and community champions for programming about entrepreneurial ecosystem development on the local level.
CEC invites attendees to spend two days in a rural Wisconsin community and see for themselves a vibrant small-business sector. Local businesses host panels and presentations, and attendees have the chance to explore the town and network in between sessions. An annual event in many other Midwestern states, the CEC Conference was held in Wisconsin for the first time in 2024.
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Immigration, Employment, and Entrepreneurship: A Legal Symposium for Wisconsin’s Workforce
Friday, September 20, 2024
Join us for a professional development training for business service providers who work with new immigrants and newcomers in Wisconsin, covering topics related to employment and entrepreneurship. Continuing legal education credit available.
The Rural Wisconsin Entrepreneurship Initiative will host a legal symposium for Wisconsin’s workforce at the WI Latino Chamber of Commerce in Fitchburg. This is a professional development event, led by the Law and Entrepreneurship (L&E) Clinic. This symposium will provide insights into enhancing service providers’ understanding of laws, regulations, and practical solutions concerning employment and entrepreneurship for new immigrants and undocumented workers. The training will cover topics relevant to employers, employees, job seekers, and entrepreneurs.
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Learn Business FUNDAMENTALS
Entrepreneurs will learn how to start or grow their business through sessions focusing on different parts of business model development. Each session will have speakers who are business experts in the food and farming industry and/or Wisconsin food and farming entrepreneurs who will share their business stories.
Build Business CONNECTIONS
Entrepreneurs will connect with business consultants, service organizations, and other entrepreneurs through interactive sessions, networking activities, and through 1-1 conversations throughout the 2-day conference.
MARKET Your Business
Entrepreneurs have the opportunity to promote their business during the Entrepreneur Showcase session, and be able to speak 1-1 with hundreds of other entrepreneurs and business industry experts.
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How Ready are Owners for Business Succession and Transition?
This webinar shares findings from a recent survey of small businesses in Minnesota that explored business owner awareness, attitudes, aspirations, and preparedness for transferring their business when the time comes. This webinar also discusses the importance of business succession and transition planning and highlights what community economic development practitioners can do to support small businesses with guest presenter, Michael Darger.
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(Wisconsin Public Radio - 8/16/2024)
(WisPolitics.com - 7/15/2024)
(WisBusiness.com - 6/26/2024)
(Capital Times - 6/15/2024)
(Institute for Business & Entrepreneurship - 6/5/2024)
(Wisconsin Newspaper Association - 5/28/2024)
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Equal Employment Opportunity & Affirmative Action Statements
An EEO/AA employer, the University of Wisconsin-Madison Division of Extension provides equal opportunities in employment and programming, including Title VI, Title IX, the Americans with Disabilities Act (ADA) and Section 504 of the Rehabilitation Act requirements. Please make requests for reasonable accommodations to ensure equal access to our educational programs as early as possible preceding the scheduled program, service, or activity.
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