David Cameron has been forced into an embarrassing u-turn in his party conference speech, after planning to urge the British public focus on paying off their debts. The retailers went bonkers – because of fears that the speech would encourage stagnant economic growth in consumer spending.
The electronics industry in particular could have been hit. Hysteria reached fever pitch and eventually Cameron was forced to run with the “we’re in it together” message again. Consumers are already looking after their debts.
For certain markets, like the quick-moving consumer electronics industry, they’re already floundering. PC and notebook sales are slow. Could his speech have made things worse?
Well, probably not.
According to economist Tim Leunig at the London School of Economics Cameron’s big idea for the big idea could have a knock on effect… if anyone bothered to listen.
“Electronics items are often discretionary,” he told TechEye. “Most of the time people don’t buy new TVs or MP3 players because their old one’s broken, it is to update and this means that they are inessential. And a lot of electronics goods are in fact bought on cards, so this could have a massive impact.”
However, calls for austerity on the high street would have likely fallen on deaf ears anyway.
Leunig reckons that such remarks from Cameron would have amounted to little more than party conference rhetoric.
“If everybody listened to calls for drops in credit card spending then it would be bad news,” he said. “But in the past Cameron urged everyone to eat more fresh fruit and veg; when was the last time anyone paid any attention to him?”
Leunig continues: “The likelihood of anyone actually acting on it is negligible, and unless there were any moves to introduce a levy or so on you could only imagine the public in a country like North Korea actually changing their behaviour immediately.”
Mobile expert at uSwitch Ernest Doku also believes that it would take a masterful grasp on persuasion to get the public to cut back.
“People rely heavily on their phones in their day-to-day lives, and cutting back on mobile usage is unthinkable for many, who would prefer to make sacrifices elsewhere,” he told TechEye. “The mobile phone has become more than simply a device to keep you in touch with others, now, for many, it’s a status symbol.”
Although our pockets are empty, we’re still buying. So perhaps Cameron is wrong when he says the public are already keeping their bills at bay: “Consequently, despite a squeeze on people’s finance in recent years, the demand for mobile handsets has proven pretty resilient. For many, being without a mobile phone at all times is now unthinkable, and similarly, a phone which provides just basic functions is no longer enough.
“If anything, the hunger and demand for new mobile technology is gathering pace, and people would rather make other sacrifices before missing out on owning the latest handset.”