We have been told that the U.S. economic recovery from the Great Recession officially started in June of 2009. I don”t know about you, but for me and most of the people I know we don”t feel like we have recovered much. Many of us still feel that we are on a downhill slide and the most current U.S. Census Bureau statistics prove it. 2011 numbers are not available yet, but in 2010 average U.S. median household income dropped by $1,154 to $49,445 and the average California household income slid $2,602 to $54,459. Here in California, adjusting for inflation, we are on equal footing with 1998. So, in 12 years the average family went nowhere income-wise.
The Great Recession has brought about many lifestyle changes. How many people do you know who have adult children living at home? There are also plenty of cases in which senior citizens have moved in with their children. Many people have given up on the idea of retirement and are working longer and harder for the same wage they were receiving when the recession started. Lots of people have dropped health insurance to have more money in their paycheck, so they are foregoing basic medical and dental care in order to make ends meet.
Lots of things have changed during the past few years and most of them have not been for the better. One of the changes that has really annoyed me is how many of the consumer products manufacturers have decreased their package size and either left the price the same or actually increased what we have to pay for less product. Most of this started right after the turn of the century, but has picked up steam since 2008, after the lean years of the recession began. In 2002 the ice cream industry, due to a huge cost increase in butter fat switched from what, in my lifetime, I had always known as the standard package, the half-gallon “brick,” to 1.75 quarts. Now, it has gone to 1.5 quarts.
Edgar Dworsky, the former Massachusetts assistant attorney general in the Consumer Protection Division said, “Downsizing is nothing but a sneaky price increase. I”m waiting to open a carton of eggs and see only 11.” He may not have long to wait. Many products, even those with the highest brand recognition, have undergone adjustments to package sizes in order to make it look like we are getting a good deal when we are really getting less for more. Have you noticed that a case of soda, which had always been 24 cans, is now at 20?
While this entire process of adjusting the volume and not lowering the price has made me angry, there is another scheme involved that really gets my goat. That is that many manufacturers have gone to great lengths to hide the fact that they are selling us less product. Harvard marketing professor John T. Gourville said, “Consumers are generally more sensitive to changes in prices than to changes in quantity and companies try to do it in such a way that you don”t notice, maybe keeping the height and width the same, but changing the depth so the silhouette of the package on the shelf looks the same. Or sometimes they add more air to the chips bag or a scoop in the bottom of the peanut butter jar so it looks the same size.”
Five or so years ago, Lisa Stauber, a Houston mother of nine, would buy 16-ounce cans of corn. Next they became 15.5 ounces, then 14.5 ounces, and the can size continues to drop. “The first time I”ve ever seen an 11-ounce can of corn at the store was about three weeks ago, and I was just floored,” she said. “It”s sneaky; because they figure people won”t know.”
If there is one thing I don”t like, it is being deceived. I personally believe marketers would be better off just telling the truth; our prices are up because our costs went up.
Gary Dickson is the publisher of the Record-Bee. Call him at 263-5636, ext. 24. Email him at gdickson@record-bee.com.
