Consumption Trends: Services Lead Preferences

From January 2017 to May this year, the consumption of domestic durable goods has fallen 10.7% in real terms. One of the most representative items is the sale of cars, which has suffered a significant drop.

The consumption of semi-durable and non-durable goods and services has grown 4.8, 4.4 and 4.5% respectively in the same period.

It is surprising that the total consumption of imported goods increases 10.5% in this period.

The progress of services is striking. In the last 10 years they have gone from representing 41% of spending to 46% today. This increase has eaten up the share of non-durables, which go from 44 to 37% respectively.

What factors can explain a consumer's preference for services?

First, it should be noted that it is a global trend, the greater growth in the demand for services with respect to goods.

Likewise, the supply of services grows with technology and structural trends (demography, urbanization) and demand patterns.

Within services are transportation, leisure and entertainment, health, communication, eg; video games, tourism, restaurants, cinema, telephony, etc.

The consumption of durable goods has lagged behind high interest rates for its financing and a labor market that generates low-wage jobs.

In an environment of low growth in consumer income, the consumer reallocates his spending within his means. We do not believe that this pattern will change in the short term, rather the opportunities that the services sector offers should be sought.