This year's back-to-school shopping shaped by inflation, tariffs and heat

Cinthia Scavone didn’t waste time getting her older son ready for his first year of college.

The Massapequa resident started shopping online in June for dormitory items for the teen, whose classes start next week.

“I don’t know if the prices were going to be higher later on because of the tariffs,” said Scavone, 49.

“So, I was like, let me just order now, the bedding … the material, because that might change the prices,” she said Thursday morning in Walmart in Farmingdale, where she picked up pencils, notebooks and other supplies for both of her sons, one of whom is starting his junior year in high school.

Scavone is among parents on Long Island and across the country who, concerned about the impact of tariffs and inflation on the costs of goods, started their back-to-school shopping earlier than normal this summer, and they’re looking for more deals, retail experts said.

But shoppers have delayed buying back-to-school clothes amid a hotter-than-normal summer that is more suitable for tank tops and shorts than new long-sleeved shirts and jeans, retail experts said. 

“People are digging themselves out of this post-inflationary economy. Some people’s finances are so strained that there is literally no wiggle room. There’s no room for another tax. So just to mention tariffs has people scrambling to come up with strategic ways to just keep their budgets in line" and find good back-to-school deals, said Chip Lupo, writer and analyst at WalletHub, a Miami-based personal finance company.

Hitting the stores in early July

This year, 67% of back-to-school shoppers began buying items by early July, up from 55% last year, according to the National Retail Federation's survey of 7,581 consumers last month. It was the largest share of early shoppers since the Washington, D.C.-based trade group started tracking the data in 2018, when 46% of respondents had started shopping by early July.

"While consumers may feel more positive about promotions and sales so far this back-to-school season, they’re still being careful to spread out their budgets and holding out for the best deals," the federation said.

As of early August, shoppers purchasing merchandise for children in kindergarten through 12th grade had completed 46% of their buying, down from 53% the same time last year, a federation survey of 7,887 adult consumers found. 

Hempstead resident Jennifer Lawhorne, a mother of five children ranging in age from 7 to 18 years old, began shopping a few weeks ago but has been keeping an eye out for deals.

“Everything is a lot ... from just their pencils, pens, markers, from sneakers, socks, underwear, uniform, everything,” said Lawhorne, 38, after she shopped at the Walmart in Farmingdale on Sunday. Her youngest child is enrolled in a charter school, while the oldest is heading to college in Brooklyn and the other three are in  standard public schools. 

Although consumers were spurred by tariff concerns to start shopping early, the direct effects of tariffs on retail prices haven’t been felt yet by consumers, said Michael Zdinak, economics director of consumer markets at S&P Global Market Intelligence, a Manhattan-based financial analysis provider. 

That is partly because retailers appear to be depleting current inventories or taking temporary hits to their profits before raising their prices, he said in an email Wednesday. 

Three countries — China, Vietnam and India — account for half the clothing imported to the United States, said Alex Durante, senior economist at the Tax Foundation, a Washington, D.C.-based nonprofit think tank.

Under enactments this year by President Donald Trump's administration, a 20% tariff on imports from China took effect March 3, followed by an additional 10% on April 2.

On Aug. 8, a 20% tariff on imports from Vietnam and 25% tariff on imports from India took effect. India's tariff is scheduled to rise to 50% on Aug. 27. 

Though overall retail prices of most back-to-school items haven’t changed much from a year ago, parents are still being cautious about their spending, even if they aren't cutting back, Zdinak said.

“Before the [COVID-19] pandemic, consumers were accustomed to getting more for their money. So while the rise in prices of back-to-school items is modest, especially when compared to things like food and housing, it can still be tough on parents who feel like they are being nickel-and-dimed everywhere they shop,” he said.

Through June, the biggest price increases year-over-year were in the costs of textbooks, up 10.3%; stationery, up 4.3%; and software, up 4.5%, he said. But prices declined for computers and tablets, 0.3%, and children’s clothing, 2.4%.

Weathering the heat

While parents shopped earlier for school supplies, they are delaying buying new clothes for their children because of an unusually hot summer, choosing to wait until fall’s lower temperatures, retail experts said.

“The biggest challenge for back-to-school [sales] has been the weather. It’s just been unseasonably hot in so many areas of the country. That impacts the consumer, you know. We’re living in a buy-now, wear-now, needs-now society,” said Marshal Cohen, chief retail adviser in the Port Washington office of Circana, a Chicago-headquartered market research firm.

This year, June was the hottest for that month on record on Long Island.

Islip, where the National Weather Service has a climate station, recorded an average temperature of 72.2 degrees, factoring in the daily highs and lows, said Jay Engle, meteorologist at the NWS in Upton. And July was the second-warmest for that month on record, with an average of 78.5 degrees, he said. 

Climate change results in higher baseline temperature and drives more intense heat waves, Samantha Borisoff, a Cornell University climatologist, wrote in an email to Newsday.

"If we look at long-term trends ... we can see that summers are warming. As an example, Islip’s 10 hottest summers since 1964 (when its records start) have all happened since 1999 (with nine of them occurring since 2010)," she wrote. 

The hot weather is a major reason Randi Cone, of Huntington, is holding off on buying clothes for her two kids — 10 and 12 years old — she said Sunday.

“They don’t need it yet. So, we’re going to take an inventory when things calm down a little bit and we get back in the swing of school. And see what … we need once we’re out of summer,” she said outside a Target in Huntington, where she had purchased a bookbag and other school supplies.

Cone, 41, also is looking at her kids’ supplies from the last school year to see what can be reused, she said.

Queens couple Marvin and Melisa Gayle, however, said they can’t delay buying school clothes until the fall because their two youngest kids — 15 and 6 years old — wear uniforms to private school.

The Gayles will pay $300 more this year for uniforms, they said outside a Burlington in New Hyde Park on Sunday.

“It’s not as reasonable as it used to be,” said Melisa Gayle, 43, who said her family is still spending less than what other parents pay for school clothes for their public school children.

Parents are also shopping earlier this year because many school districts nationwide are opening earlier than they did in the past.

On Long Island, most of the 124 public schools will begin classes Sept. 2, the day after Labor Day. The Jericho Union Free School District will be the first to start its classes, on Aug. 27.

Where shoppers are going

Getting the best prices possible is the top concern for 57% of back-to-school shoppers this year, up from 52% last year, according to a national survey of 3,000 households with children that was conducted in August by Numerator, a Chicago-based market research firm.

Nearly all shoppers plan to try to save money using various means, with 68% saying they’ll shop at sale events, 58% saying they’ll compare retailers’ prices, 57% expecting to use coupons or promo codes and 45% planning to reuse school supplies from previous years, the Numerator survey found.

Walmart is expected to be the most popular retailer for back-to-school shopping, while Target and Amazon will compete for the second spot, according to Coresight Research, a Manhattan-based retail analysis provider.

Old Navy and Foot Locker likely will be the top two specialty retailers, based on shopper numbers, Coresight reported. 

Dollar Tree, Dollar General and other deep discounters also stand to benefit, and they are pulling a growing share of higher-income consumers who have become more sensitive to prices, Coresight said.

In Dollar Tree’s fiscal first quarter, which ended May 3, the biggest sales growth came “from our higher-income customers. In particular, we saw a meaningful traffic increase from customers with household incomes of more than $100,000, demonstrating Dollar Tree's broad appeal,” Dollar Tree Inc. CEO Michael C. Creedon told analysts during an earnings call in June.

Several retailers, including Walmart, Target and Kohl's, rolled out sales around Amazon Prime Days, which were July 8 to 11.

“So, that’s probably encouraging people to shop for back-to-school earlier than they would have in the past,” said David Swartz, senior equity analyst at Morningstar Research Services LLC, a financial services firm in Chicago.

Nationwide, back-to-school spending is expected to be strong this year, growing 3.3% to $33.3 billion compared with the same period last year, according to Coresight. But parents are being choosier about when, where and how they shop, experts said.

Retailers took notice with special back-to-school prices.

The world’s largest retailer, Walmart, announced in July it was lowering prices on 14 of its most popular school supplies below last year's costs, and launching other deals.

“Customers can snag everything they need for their first day of school — supplies, backpack, lunch, and head-to-toe outfit — all for under $65,” the Bentonville, Arkansas-based retailer said in a statement.

In July, Dollar General announced all its core back-to-school items, including Crayola crayons, Elmer’s glue sticks, notebooks and binders, would be offered at last year’s prices.

Target also launched a back-to-school sale that ran from July 27 to Aug. 2 that offered discounts of up to 30% on some items, such as backpacks and kids’ clothes. 

The Minneapolis-based retailer is attempting to woo back shoppers after seeing its net sales fall for three consecutive quarters. 

A major factor in the sales declines is the backlash Target is facing since announcing in January that it was pulling back on its diversity programs.

The retailer released earnings results Wednesday showing net sales in its fiscal second quarter, which ended Aug. 2, were $25.2 billion, down 0.9%, or $241 million, from the same period last year. Sales at stores open at least one year fell 3.2%.

Target Corp. announced Wednesday that chief operating officer Michael Fiddelke will be taking over the CEO reins from Brian Cornell, effective Feb. 1.