The decline in spending on travel, entertainment, and the like is temporary, so the “nothing else to spend it on” effect has already diminished and will disappear entirely.
I disagree that we’ll ever get back to pre-COVID levels on a lot of these issues.
I think these broad “fun outside the home” areas that ranges from trips to France to Applebees, will never recover.
Older people, even fully vaccinated, are frequently afraid to resume these activities. Others don’t like the additional hassle, like covid tests before you can come home from a trip abroad.
And on top of just older people, you have a lot of younger people who consider themselves immuno-compromised, and young people who are in regular contact with elderly relatives.
Then there’s the labor shortage issue. Restaurants in general have worse service and higher prices than before.
Here’s one way the new “nesting in a bigger home” is permanent for me. I spent a ton of money setting up a full home gym. This has both saved me money on gym membership and transportation costs to get there, but permanently increased my demand for residential housing.
What percentage of the population will never go out to the movies again because they upgraded their home theater system with high end speaker and an 60-inch TV or even a projector setup?
