How consumers behave during this year's back-to-school shopping season could give us our first taste of what's to come for the economy.
More and more economists believe the worst U.S. recession since the Great Depression will come to an end in the third quarter. But there is still much disagreement about what the recovery will look like.
At the center of that debate is the consumer.
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Will consumers start spending again once they see signs of new life in the economy? Or are consumer balance sheets so underwater that it will take years for them to shake their newfound thrift?
The back-to-school shopping season could provide some answers.
Right now, the general consensus is that consumers will continue to feel pinched, so they'll hunt for discounts and focus on necessities. Still, some economists think that once the economy begins to pick up, consumers will open their wallets because of all the pent-up demand.
The forecasts are not robust. The National Retail Federation expects back-to-school spending to be down about 7.7 percent from last year. Other analysts are slightly more optimistic, but even the more bullish ones expect to see a challenging season.
From company sales reports and the Commerce Department's retail sales report, we know that the season has gotten off to a late start. That's partly due to the late Labor Day holiday, which has prompted many school districts to delay the start of the school year.
Some students plan to wait to go back to school to see what their peers are wearing before they buy their wardrobe. Also, some states have delayed tax holidays, and shoppers will wait because they don't want to miss out on the added savings those programs provide.
"If back-to-school sales don't materialize early, we believe retailers could become very promotional in an attempt to drive traffic and sales," said Citigroup analyst Deborah Weinswig, in a recent research report.
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According to Stacey Widlitz, a managing director at Pali Research, it shouldn't come as a surprise that consumers are shopping for items such as fall clothing later in the season.
"The department stores have trained us to wait for the discounts," she said.
But Widlitz also thinks consumers' frugal ways are here to stay.
"I think the one interesting thing about this environment is that it sort of forced the consumer to go out and say, 'Hey I’ve been overpaying, and if I actually open my eyes and look around, I can get great value,' whether that's my food, my clothes, or my handbag," Widlitz said. (To hear more from Widlitz, click here.)
However, the discounts may not be as eye-popping as those during the last Christmas holiday season. Since retailers have grown accustomed to the new climate, they have controlled their inventory levels, and price cuts will not need to go as deep as last holiday's 50 percent to 70 percent off. Instead, retailers may need to trim prices only by 25 percent or so to get items moving.
Retailers have had time to adjust, and their products are more appropriate for the new climate. Even high-end department stores have adjusted to the new reality, as seen by Nieman-Marcus' decision to sell children's Levi jeans.
As we enter the back-to-school shopping season, there are already signs of consumers' recalibration, according to James Russo, vice president of Consumer Insights at Nielson.
Russo has tracked the items consumers are buying and sees an emphasis on products for the home. These include products such as Blu-Ray players, cookbooks, wine and, notably, canning and food storage supplies.
"As the consumers have accepted the severity of this recession, having moved from this period of fear and panic, they are really focused on this at-home dining and entertainment piece," Russo said.
Some of these behaviors will linger even after the economy has recovered, said Patrick McKeever, senior equity analyst at MKM Partners.
McKeever thinks consumers may begin to trade up, but will remain within the overall discount space.
"The trade-down theme will continue to work its way through the retail space," McKeever said. However, he sees a few new wrinkles.
"They'll start shopping more, maybe at Kohl's (NYSE: kss). If you look at the dollar store space, the deep-discount space, maybe they'll trade out of a Family Dollar and into a Big Lots (NYSE: big), or maybe into a Walmart (NYSE: wmt). To some extent, consumers have been permanently changed."
However, Brian Wesbury, chief economist at First Trust Advisors, said he thinks it is a common misconception that many people make at the end of every recession—that this time will be different. He expects consumers to start spending more as they get more comfortable.
Britt Beemer, chairman of America's Research Group, said the information he has been collecting disagrees with that. Consumers are focused on cutting spending because they fear losing their jobs, because they are working to pay off consumer debt, or to recoup the losses they have see in their retirement savings, or some combination of those factors.
Only 2 percent of the population is spending at unencumbered levels, Beemer said.
As shoppers make their back-to-school purchases, it will be interesting to see what they are buying. Sure, parents will have to buy new clothing for growing children, but how much will they spend, where are they shopping, are they buying non-essential items when they are at the store for themselves? Those are the questions that will help to answer what shape the recovery will be.
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For more stories from CNBC, go to cnbc.com.