As inflation continues to rise, one-third of consumers (38 percent) said they are cutting back on spending in other areas to cover the cost of items for the upcoming school year, according to the annual survey released by the National Retail Federation and Prosper Insights & Analytics.

Due to higher prices, families expect to spend more per person on K-12 and college supplies this year.

“Families consider back-to-school and college items as an essential category, and they are taking whatever steps they can, including cutting back on discretionary spending, shopping sales and buying store or off-brand items to purchase what they need for the upcoming school year,” NRF President and CEO Matthew Shay said. “The back-to-school season is among the most significant shopping event for consumers and retailers, second only to the winter holiday season.”

Total back-to-school spending is expected to match 2021 record high levels of $37 billion.

Families with children in elementary through high school plan to spend an average of $864 on school supplies, approximately $15 more than 2021.

Back-to-school spending has increased significantly since the onset of the pandemic as families adjusted to changes from virtual and hybrid learning.

Compared to 2019, consumers shopping for back-to-school are expected to spend $168 more on average, and total spending will be up $11 billion.

Total back-to-college spending could reach nearly $74 billion, up from last year’s record of $71 billion. The highest in the survey’s history.

More college students and their families plan to shop this year compared to 2021 and anticipate spending an average of $1,199 on college or university supplies, consistent with last year’s $1,200. Since 2019, total expected spending on back-to-college has grown by $19 billion and consumers are spending $223 more on average than they were before the pandemic. Nearly half of the increase comes from spending on electronics and dorm or apartment furnishings.

Like other recent holidays, consumers are starting early to find the best deals and help spread their budgets. As of early July, more than half, 56 percent, of consumers had started shopping for school and college necessities.

Consumers may be more motivated to jump-start back-to-school shopping this year, given the impact of inflation and higher prices. A majority, 68 percent, of survey respondents said they had seen higher prices on school items. The top areas where consumers noticed higher prices were clothing, accessories, and school supplies.

The vast majority, 85 percent, of back-to-school and college families indicated they have at least half of their shopping remaining. The top reasons consumers have not checked items off their list are because they do not know what is needed and are waiting for the best deals.

Given this year’s inflationary pressure, traditional sales events may play an even more prominent role for back-to-school and college shoppers.

Most, 81 percent, respondents said they plan to use retailer deals during the week of July 11 to shop for school and college items. Approximately 3-out-of-5, 62 percent, said they would shop Amazon Prime Day deals, 31 percent would shop online deals at other retailers and 20 percent would shop in-store deals at other retailers.

“We have seen real shifts in how people are shopping and spending on back-to-class items since before the pandemic. As a result, retailers are also shifting by bringing in inventory earlier and extending back-to-class offerings,” Prosper Insights Executive Vice President of Strategy Phil Rist said.

Compared with pre-pandemic habits, back-to-school and college shoppers plan to concentrate their shopping rather than spreading it out across multiple destinations.

The Top 5 back-to-school shopping destinations are online (50 percent), department stores (45 percent), discount retailers (40 percent), clothing stores (37 percent), and electronics stores (28 percent).

Top back-to-college shopping destinations are online (43 percent), followed by department stores (36 percent), discount stores (29 percent), office supply stores (27 percent), and college bookstores (26 percent).

The survey of 7,830 consumers was conducted from June 30 to July 7.

Photo courtesy Rakuten