Yelp Says User Data Signal U.S. Economy Weakened in Last Quarter
(Bloomberg) -- A new Yelp Inc. gauge of consumer and business activity compiled from user data signals that the U.S. economy was showing broad signs of deceleration at the end of last year.
The online user review company’s measure weakened in the fourth quarter, due largely to softness in the professional, home, and services categories, according to a report Thursday. The gauge showed declines across 29 of 30 business categories, which are tracked using company data for consumer demand as well as openings and closings of establishments.
“Slumps in core business sectors may be early signs of an economic downturn,” Carl Bialik, Yelp’s Data Science Editor, wrote in the report. “The downturn left few business sectors untouched. Everything from high-end retail such as jewelry stores and antique shops to pricey professional services such as private eyes and architects were hit hard.”
While the measure isn’t comparable to gross domestic product, it comes as investors are still waiting for the Commerce Department’s fourth-quarter GDP report, which was due for release this week but was postponed because of the federal government shutdown and hasn’t been rescheduled yet. Inflation-adjusted GDP growth slowed to a 2.6 percent annualized rate, according to Bloomberg’s survey, after a 3.4 percent third quarter advance.
Breakdowns provided with the report showed declines for activity associated with car dealerships and luxury retail, such as jewelry stores. Gas stations were the only one of 30 categories to show an increase in activity in the fourth quarter.
San Francisco-based Yelp said it tracks of millions of U.S. businesses by measuring the activity of about 34 million monthly app users and 75 million mobile users, adding that research shows the data have the potential to “accurately and quickly measure a huge swath of the economy that is missed by many major indicators.”
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