While most American are thrilled to be paying less for gas at the pumps, a prolonged slump in oil prices can have a ripple effect with damaging results in certain retail markets.

Most major oil companies have said they could withstand crude oil priced at $40 a barrel. But oil dropped to below $30 a barrel, and some industry experts said it could go even lower. As a result, jobs losses in the oil-producing markets are increasing as local economies falter. According to oil industry consultant Grave & Co., oil and gas companies have laid off 250,000 workers worldwide and more cuts are expected.

In the U.S., Stage Stores said its holiday sales had dropped 2.5 percent and part of the decline was blamed on stores impacted by the oil and gas industry. Stage Stores chief executive officer Michael Glazer said last week at the ICR conference in Florida that the company has a board member who is in the oil business, and this person expects oil could hit $25 a barrel. Glazer said, “Does that mean we’re going to end up with more unemployment in some of our areas? It could be. Even if it goes back to $40, does that mean there’s going to be more employment?”

At Signet Jewelers, holiday sales rose 5 percent, but the company noted sales in Canada had been impacted by lower oil and gas prices. Chief financial officer Michele Santana said during the December sales and revenue call that what started as a regional issue has now emerged with national impact.

Boot Barn, which specializes in Western and work-related footwear and is located in Texas, North Dakota, Colorado and Wyoming, is also feeling the pressure. While the company tried to downplay its dependence on the oil industry at the recent ICR conference, the top-line has been affected by downturns in regional markets with sales for the third quarter falling 2 percent. The company acknowledged that sales in those markets continued to be pressured, and those four states reflect 30 percent of the company’s total units.

John Idol, chief executive officer at Michael Kors, said during the company’s November earnings call that it too was impacted in parts of Texas because of falling crude prices. Undeterred, though, the company said it is still looking at a prime location in Memorial City mall in Houston, Texas.

At Neiman Marcus, the retailer conceded that it was also feeling the negative effects of lower crude oil prices. Chief executive officer Karen Katz said during the company’s first-quarter 2016 results that “many of our customers have direct or indirect oil and gas investments. Lower prices for crude oil adversely affects oil company profit and the personal balance sheet and investment portfolios of our customers who work for or invest in these companies.”

While cheaper oil prices means that shipping costs are falling for retailers, few companies have mentioned any such savings. Low-priced oil also brings down the cost of synthetic fabrics, but since cotton prices have declined as well, few apparel brands have made note of any such savings.

Low gas prices at the pump normally translates into more consumer purchases as people tend to spend their gas savings in the stores, but unfortunately that hasn’t come to pass this time. Earlier this year, economists were puzzled that consumers were saving money at the gas pump, but retail spending hadn’t increased. Then in October, a JP Morgan report found that consumers were spending those savings, but most of it was spent at restaurants.

Long-term cheap gas at the pump also means lower tax receipts for many municipalities. Lower revenue could result in either a reduction in services or increases in other taxes, which could cool consumer spending in local markets.

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