When the going gets tough, we get spending — on our children.
Even as retailers brace for a lackluster holiday shopping season, companies offering team sports and tutoring for kids are gearing up for growth.
“Our society has changed, and kids can’t just go play in the street,” said Dev Pathik, CEO of consulting firm The Sports Facilities Advisory. “Parents have chosen organized sporting events and training, [hoping for] a college scholarship.”
In a study published last year in Demography, sociologists Sabino Kornrich and Frank Furstenberg found that from 1972 to 2007, parents spent more on their children’s education and care than on consumer goods.
Wealthier households spent the most, but lower-income parents allocated greater shares of income to their children.
In a follow-up study, Furstenberg found that the recession prompted middle-class parents to slash some spending on kids’ programs. But adults also did without things they needed, in order to fund children’s after-school activities.
Families continue to funnel money into education and sports. From 2011 to 2012, spending on team sports at school rose 22 percent and outside of school 16 percent in 2012 from 2011, according to the Sports and Fitness Industry Association.
At Brooklyn’s Aviator Sports and Events Center, Chief Operating Officer Dean Rivera said youth and amateur sports, rather than adult fitness, are unexpected growth engines.
Tutoring is another hot area. Earlier this year, Barry Diller’s media company, IAC, reportedly spent roughly $40 million to acquire Tutor.com. Plans call for growing the number of tutoring sessions per night threefold, to 22,500.
But experts question how much longer cash-strapped parents can keep spending.
“Middle-income families and below are continually struggling to invest enough in their children,” said Furstenberg.