Consumers seen spending even less in early '09

By Brad Dorfman - Analysis

CHICAGO (Reuters) - If you think Americans are spending less now, wait until after Christmas.

Analysts expect consumer spending to nose dive again in the first part of 2009, with the U.S. economy mired in recession and no more big shopping holidays.

Even an economic stimulus package from the federal government would not help because any package would come later in the year, they said. And retailers, restaurants, airlines, casinos, hotels and Broadway are likely to feel the effects.

"It's a recipe for consumer spending to really fall off a cliff here," said Ken Perkins, president of research group Retail Metrics. "There really is no catalyst to drive consumer spending for the next three months."

U.S. personal spending in October, the most recent month reported, fell 1 percent, the largest decline since September 2001 after the attacks on the World Trade Center and Pentagon.

In a survey over the weekend by America's Research Group, 44 percent of 1,002 respondents said they would further cut spending after the holidays. That's about twice as many people saying so as is typical in the survey, America's Research founder and Chief Executive Britt Beemer said.

Among the respondents, 37.6 percent said they would spend less dining out and 20.2 percent said they would spend less on entertainment. The restaurant industry is already among the hardest hit by the recession.

An RBC Capital Markets survey this month showed a record 51 percent of consumers said they would spend less at restaurants over the next 90 days compared with the previous 90 days.