Hot dogs, camping trips and cardboard boxes: What these non-scientific indicators tell us about the economy

Gray’s Papaya hot dog restaurant in Manhattan has served up beef franks to the hungry and frugal masses for the past five decades.

But the bustling business off 72nd and Broadway isn’t just an iconic New York City bastion for cheap eats — it also moonlights as an unofficial economic indicator.

When hot dog sales there see a dramatic pickup — particularly the two-frank-and-tropical-drink “Recession Special” — it’s usually a signal that folks have fallen on harder times, owner Rachael Gray told CNN.

“We noticed a big uptick around 2008-2009, when everything was collapsing (amid the Great Financial Crisis), and we are feeling the same thing right now — to a lesser extent, obviously, but the pattern is the same,” she said.

There are scores of traditional, time-tested gauges of the US economy’s health and its trajectory: Federal data on employment, production, spending, income and other critical areas factors heavily into the calculus of the National Bureau of Economic Research, the official arbiter of recessions, when it dates business cycles.

(The NBER’s declarations, by the way, don’t happen in real time. They often come months, and sometimes not for two years, after a recession has already started.)

Still, as it stands now, while some barometers indicate the US economy is slowing, recent data has shown that it’s still growing, consumer spending remains strong and the unemployment rate isn’t yet tripping alarm bells.

However, for many Americans, especially middle- and lower-income households, there’s a growing disconnect. This sure doesn’t feel like a period of economic prosperity, they say.

“When we look at these aggregate numbers, that’s representative of some average outcome,” Ariel Zetlin-Jones, associate professor of economics at Carnegie Mellon University’s Tepper School of Business, told CNN. “It’s not showing us distributional outcome. And so, as inequality increases to some extent, people will disagree with what they see in the averages a little bit more.”

So, beyond the spreads of credit, the curves of yields and the claims for unemployment benefits, there’s a motley crew of unorthodox metrics that are gaining popularity at a time when aggregate spending data mostly reflects the actions of the well-heeled few (and when fears are heightened about the integrity of federal data — or whether we’ll get any data at all, if the government shuts down).

While seemingly more silly than scientific, here’s what a selection of some real-world objects and activities — like hot dogs, movie-going, pawn loans, cardboard boxes, camping and gas station snacks — can tell us about the state of the American consumer and broader economy.

Franks and foundations

The Gray’s Papaya sales pattern appears to convey a straightforward trend: When people are looking to save money, they’ll seek out value and turn to cheaper eats.

In recent weeks, sales of the $7.50 Recession Special have been on the rise. However, Gray’s noticed that customers are sizing down even further: Even more people have been ordering up the $5 one-dog-and-drink Local Special (which was launched in 2018).

But there’s a negative correlation element also at play: declining activity at Rachael Gray’s architecture practice.

“My architectural practice has slowed down, and Gray’s is picking up in terms of the number of tickets,” she said, adding that dynamic was often noted by her husband and Gray’s Papaya founder, Nicholas Gray, who passed away in 2023.

“When Nick was alive, he would always say, ‘If we’re going into a recession, you’re going to slow down and Gray’s will carry us; and then in good times, it’s the other way around,’” she added.

Boxes and boxes

In this age of Amazon, packages promptly appear on doorsteps following a mere click of a button or a vocal cue. The discards fill recycling bins to the brim and clutter closets, basements and hallways.

Now, the seemingly unfathomable part: Cardboard box shipments are at a decade low, and producers of the ubiquitous products are cutting production and laying off employees.

About 9% of domestic box production capacity is set to shut down, which is the steepest retraction for the industry since the 2008 financial crisis, Virginia Tech economist Jadrian Wooten wrote earlier this month.

“What does this mean for the rest of us? If we’re to assume that cardboard boxes are a leading indicator, it could be a bad sign of what’s ahead,” Wooten wrote. “If they’re cutting back on capacity, it likely comes as a response to fewer orders. That would suggest weaker demand in the broader economy. If shipments keep falling, other indicators like GDP or unemployment may eventually catch up.”

While not all of the slowdown in box production can be attributable to falling demand for goods, the slump is present in other areas of the freight economy, said Adam Josephson, a longtime paper and packaging sell-side analyst who now authors an economics newsletter.

The Cass Freight Index, which measures aggregate deliveries of freight across North America, is at its lowest level since the early stages of the pandemic, he said. Excluding the steep plunge in 2020, the index is at its lowest since 2010.

“That ought to tell you something,” he said. “Whether you look at the trucking market, the box market, they tell you that there is a real problem here with goods demand that only seems to be getting worse.”

… and box offices

Movie theaters have long been considered a countercyclical economic indicator, said Paul Dergarabedian, senior media analyst at Comscore, which tracks an array of media platforms, including the silver screen.

“During the Great Depression, people went to the movies in huge numbers, so it does seem that the escapism and the respite from the real world that movie theaters provide has value as much today as it did 50 or even 100 years ago,” he told CNN. “While moviegoers are price-sensitive, going out to the movies is a relatively inexpensive way to be entertained outside of the home.”

Through September 28, box office revenue is up 4.5% from this time last year, Comscore data shows.

However, there are plenty of caveats that come with cinema data, and, oftentimes, it’s the content that plays an outsized role in demand swings, Dergarabedian noted.

“People see going to the movies as an affordable escape, but they’re not just going to do it for the sake of going out of the house. They’ll go if a movie looks compelling or if it has great word of mouth and/or great reviews,” he said.

Campfires and snacks

Another sky-is-blue datapoint: Spending on outdoor activities typically increases during the spring and summer months.

However, since April, spending at campsites has spiked and was up 15% year over year in August, according to Bank of America card data. That’s the strongest growth seen at campgrounds since early 2022 (when inflation was escalating).

“Consumers may be trading airfare for fire pits, drawn by affordability and a wellness-focused vibe,” Bank of America analysts wrote in a note last week.

Recent months’ data and company earnings reports show that Americans are putting an increasing share of their dollars toward essential areas — particularly health care, housing and insurance — as they pull back on other spending, former packaging analyst Josephson said.

“As more of people’s wallets go toward mandatory items, the less money they have to spend on discretionary items,” he said in an interview.

People trade down, look for bargains and cut out some expenses.

And when figurative financial belts are tightened, nonessential goods like snacks oftentimes land on the chopping block (which, in turn, could lead to literal belt-tightening).

“We continue to see lower-income, lower/middle-income consumers stretched, strained, really controlling their spending,” Alex Miller, chief executive officer of Alimentation Couche-Tard, which operates convenience stores such as Circle K, said earlier this month during the company’s most recent earnings call.

Some of the world’s largest makers of salty, savory and sweet treats have flagged weakness in their snack portfolio, Josephson said, adding that many of these companies had dramatically hiked their prices in recent years.

“Coincidentally, their food volumes have been under constant pressure in recent quarters,” he said.

Pawn loans picking up

The latest available Federal Reserve data on loan officers’ lending practices showed that standards are getting tighter and credit is increasingly harder to obtain for consumers with lower scores.

Those turned away are instead turning up at the local pawn shop.

At EZCorp, which operates hundreds of EZPawn shops across the United States, the pawn loans outstanding and overall revenue hit record highs during the second quarter.

“I think the liquidity tightening for more of the everyday American, they’ve got rising costs and reduced access to credit,” Timothy Jugmans, chief financial officer of EZCorp, told CNN. “The consumer that we are dealing with is coming up against it, with having to get some extra cash.”

The pawns loans are typically pretty small, in the range of $200, Jugmans said. But that’s sometimes enough to fill up the car with gas or pay that unexpected bill.

“This business does well in all cycles,” he said. “In downturns, what we do see is that the loans grow a little bit quicker, but the sales margins do go on the lower end of the range we operate in. And, conversely, when consumers are feeling a bit more stable, the discretionary retail purchases increase, and so we make a little bit more money on the sales and a little bit less on the loans.”

“But we’re definitely seeing it on the loan side at the moment,” he said.