The return of fun
One of the economic sectors that is expanding the most is leisure and hospitality, which might be called “fun.” What’s going on? Why do we suddenly need a break from work and our daily chores? N.C. State University economist Mike Walden responds.
“Well, we see this each month — or the last couple of months in the employment numbers — the sector where we’re seeing big increases in employment is in the fun sectors — leisure and hospitality and travel.
“Now one reason, of course, it’s summer. But we do have seasonally adjusted data where we account for that and still the numbers are up. I think a big answer is that fun is cyclical. And by that I mean when the economy is down as it has been for many of the recent years and households are strapped for their finances, they have to look for ways to cut.
“Obviously, you don’t want to cut money you spend on the light bill or on the mortgage or on gasoline or food. Unfortunately for those in the business, cutting your expense on fun is an obvious way to go. And we see that in the data, that during the recession the hospitality and leisure section was very hard hit.
“Now that we’re having the economy recover, of course, we’re not totally back, but we are better than we were a couple of years ago, many households are seeing their finances improve, and they’re back to spending money on fun. So, I think the real answer here is that the fun industry is cyclical. It’s down when the economy is bad. It’s up when the economy is better.”Category: Economic Perspective