GRAND RAPIDS — There’s a coin shortage sweeping the nation, now the federal government is stepping in to help regenerate the cash flow.
The Federal Reserve is taking action by forming the U.S. Coin Task Force; working with industry leaders to limit coin disruptions during the pandemic, hopeful to get the coins recirculating by August. The Federal Reserve is even endorsing a hashtag for use on social media to promote the recirculation of coins, #getcoinmoving.
Dr. Dan Giedeman, Professor of Economics at Grand Valley State University says in addition to the U.S. Mint halting production of coins for a short time during the pandemic, closed businesses have coins hibernating in cash registers while some people are not using coins altogether because of the possible spread of germs on cash; simply put, consumers are just not putting coins back into circulation.
“We've had coin shortages before in the 1960s and the late 90s, and nobody remembers them because it was just this tiny little blip, and it's just another weird thing from 2020,” Giedeman said.
New spending habits prompted by the pandemic are being now being tracked by consumer spending analysts like Ted Rossman at Creditcards.com
“We do see more people going to debit and credit cards,” said Rossman. “They're trying out mobile payment services like Apple Pay, sometimes even for the first time. Some people think that it's less likely to carry germs.”
The coin supply chain includes many participants, some stores are trying everything they can to keep an open flow of money.
“I saw something pretty creative, some Seven Elevens are telling people that if they bring in $5 worth of coins, they'll actually give you a $5 bill and a free Slurpee. So that's a little incentive to get the coins flowing again,” Rossman said.
You may have head about a grassroots movement regarding the death of coins altogether, especially the penny. Rossman believes cash is not dead yet, saying half of all transactions in the U.S. last year under ten dollars were made in cash. And one quarter of Americans rely on cash as they do not use debit or credit cards.
Economists and analysts alike are encouraging people like you to use the change sitting in your piggy bank or vehicle. Take it to the bank or a coin star so we can all do our part to get the coins rolling again.