Jewelers burnt out from the holiday rush can unwrap some hopeful financial forecasts, thanks to a recent study.
Sales of jewelry and watches in the United States are expected to reach $79 billion in 2013, according to a report issued by diamond market research service Diamond Shades.
The report looks at the current economic and social state of the core age group for consumption of fine jewelry, using statistics and data from various U.S government departments, such as the Bureau of Labor Statistics.
Research found that young adults who had pushed back plans because of economic concerns after the recession are now feeling more positive about their futures, mainly because of improving employment prospects. This is great news for jewelers, considering the study also found that diamond sales typically account for more than 50 percent of total jewelry sales, and that 85 percent of diamond and diamond jewelry purchases in the United States are wedding related.
Graph courtesy of Diamond Shades
The report also forecasts that the U.S. jewelry market will grow 4 percent to 8 percent annually in the next five years because of the recovering economy and the shift to higher income groups. Growth will be strongest in 2014 because the pent-up demand for jewelry will continue to be released. Growth will be weaker from 2015 to 2016, as long-term trends start to have greater impact on jewelry sales.
- A young American likely to purchase jewelry is someone between the ages of 27 and 35, is college educated, has an annual income of $44,685, and lives in one of the top 15 states that account for more than 70 percent of fine jewelry and diamond jewelry sales.
- According to the Bureau of Labor Statistics, women enjoy an annual income premium if they wait until 30 or later to marry. For college-educated women in their mid-thirties, this premium amounts to $18,152 over those who marry before they are 30.
- Those between the ages of 26 and 35 are most likely to purchase jewelry than any other group and spend more than twice the average on gifts of jewelry.
- The marriage rate of Americans has held steady at 6.8 marriages registered per 1,000 Americans for a few years, suggesting that the number of marriages is temporarily matching population growth.
- Young adults in the market for bridal jewelry are older—closer to 30 years old—and almost always college educated.
- Fine-jewelry demand continues to erode rapidly among low-income groups that were most affected by the recession.