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July 24, 2008
Posted: 09:18 AM ET

We’re all painfully aware of how high gas prices are these days: the national average for a gallon of gasoline is just above the $4 mark, and many of you are paying a lot more. That’s forcing us to change the way we live our lives, by altering our driving habits and moving away from large gas guzzling vehicles to smaller fuel-efficient cars.

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High energy costs are also forcing Americans to change the way they spend their money, and that could have a wider impact on the nation’s economy. Remember, discretionary spending is the grease that keeps the U.S. economic engine running. Those high energy prices in the long-term will force a dramatic cultural shift in the way we conduct our lives, with wider implications for growth.

Many businesses will lose out, especially in the retail and entertainment segments. Now, a new Nielson survey seems to confirm some of this. In a poll of 50,000 Americans, almost two-thirds, or 63 percent, admitted they are cutting back on purchases because of high gas prices, up 18 percent from last year. Here’s how the survey breaks down:

1) 78 percent of consumers are combining shopping trips. Trying to get the most for their gas money, Americans are working to do more in less time by cutting out extra trips. That means less impulsive trips to the mall — and less business for retailers.

2) 52 percent are eating out less. No more nights out for a meal when you’re too tired to cook your own dinner. And that really hurts restaurant owners, who are already feeling the pinch from higher food costs.

3) 51percent are staying at home more. That may mean more business for home movie rentals and pay-per-view services, but that’s bad news for movie theaters.

There are some areas where consumers won’t cut back. TV sales are one, and vacation plans are another. Another survey put out by GfK Roper Consulting, a market research firm, shows that 50 percent of Americans plan to buy flat-screen and HD televisions in the next year as they look for entertainment options that don’t involve leaving home.

The same survey says 59 percent still plan to take a vacation in the next six months, even though some of them admit to changing their original plans to stay a little closer to home. That could mean a boost to business for regional tourist attractions. The surveyor notes Americans want to find ways to maintain their quality of life by maintaining some of life’s everyday pleasures — even when the down economic times call for some belt-tightening.

And that means more and more Americans are staying home — or close to it — for a little fun.

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Filed under: Finance • Living • Velshi


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CNN's team of experts share their top tips to help you become a wise consumer. We know you're busy, and that's why our tips are quick and effective. From health to personal finance, we'll arm you with the information you need to make smart choices.

Contributors
Gerri Willis is CNN's Personal Finance Editor, hosting Open House and appearing regularly on American Morning.
Gerri Willis
Ali Velshi is CNN's Senior Business Correspondent, hosting Your $$$$$ and appearing regularly on American Morning.
Ali Velshi
Dr. Sanjay Gupta is CNN's Chief Medical Correspondent and host of House Call.
Sanjay Gupta
Elizabeth Cohen offers up medical advice in her weekly Empowered Patient report.
Elizabeth Cohen
Judy Fortin's Health Minute segment runs daily weekdays on Headline News.
Judy Fortin
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