From Economic Meltdown to Property Crime

Some research tells us that we should not expect an increase in crime just because the economy is terrible, despite our intuition telling us otherwise. But as 2008 was reaching its inglorious end, headlines across the nation were saying the same thing, namely that property crime was shooting up and that the bad economy seemed to be the explanation.

What gets a lot of media attention are the national crime statistics released by the FBI. The latest ones reported that property crime was done in 2007 for the fifth year in a row, with a drop of 1.4 percent over 2006. There were an estimated 9,843,481 property crimes, including motor vehicle theft, larceny-thefts and burglaries, but excluding arson, in 2007, with victims losing about $17.6 billion. But the economy with its high unemployment, home foreclosures, loss of savings and other tragedies really did not hit people until 2008.

One problem is that these data on property crimes don't seem to tell the story about shoplifting. FBI statistics show a 12 percent increase in shoplifting incidents reported from 2006 to 2007. There were 978,978 incidents reported in 2007, up from 872,635 in 2006.

So we should not be surprised that newspaper headlines around the country were telling a negative story for 2008. One type of story was that local authorities and retailers were hollering about rising shoplifting. In Tampa, Florida, police statistics showed a 6 percent increase through November over the same period in 2007. In Richmond, California, police officer Victor Vaca said "We're getting older shoplifters, mothers with their children stealing day-to-day necessities. In the past, people were more likely to steal luxury items like jewelry and electronics."

Joe LaRocca, with the National Retail Federation, said there has been a rise in shoplifting and employee theft across the country as the economy worsened. "We have people who lose their job or their home, and their judgment becomes clouded," he said. "What they have historically recognized as bad has shifted." He also said that a spike in shoplifting activity in 2008 is all but guaranteed.

In December, the Retail Industry Leaders Association said that an increase in shoplifting, fraud and organized retail theft can be attributed to the poor economy and people stealing for personal use or consumption. Police are seeing more and more first-time offenders, particularly older people. The association surveyed 52 major retailers across the country about activity since September and 84 percent reported an increase in shoplifting, 76 percent noted an increase in financial fraud, 80 percent experienced an increase in "organized retail crime," and more than half said robberies and burglaries had also risen. The group says that shoplifting is up between 10 percent and 20 percent. Most interesting is their assessment that one in 11 Americans shoplift, costing stores $35 million a day.

Fighting retail crime is expensive. According to the Center for Retail Research, US stores spent about $12 billion in 2007 to fight it. This fits with the estimate that retailers lost an average of nearly $35 billion, or about 1.4 percent of their inventory, to theft last year, according to an annual survey conducted by the University of Florida. During the most recent recession in 2001, so-called shrinkage rates averaged 1.8 percent. One problem that is bound to surface soon is that when the economy sinks local law enforcement is cut to lower government spending, and even retailers suffering terrible sales often cut their security staff. So statistics may not reveal the whole crime story.

"Every recession since the late '50s has been associated with an increase in crime and, in particular, property crime and robbery, which would be most responsive to changes in economic conditions," said Richard Rosenfeld, a sociologist at the University of Missouri-St. Louis. According to him there is typically "a year lag between the economic change and crime rates." But now there is much more of an apparent uptick in property crime pretty much in sync with the current cruel economic meltdown.

Another researcher, Bruce A. Weinberg, at Ohio State University, who studied data from 1979 to 1997, says that there is a strong relationship between falling wages and higher unemployment rates for less educated men and rising crime rates.

Some police chiefs around the nation say they are not seeing more crime, but others acknowledge an increase, making me wonder whether some are afraid of telling the public the truth. But an October 2008 survey of 180 law enforcement agencies by the Police Executive Research Forum, found that 75 percent cited a recent rise in at least one category of property crime. Also, in 2008 50 percent of police agencies across the country reported an increase in burglaries, and more than 40 percent said they had seen an increase in thefts.

The chief of police in Providence, R.I., admitted he has seen a rise in crime, some of it related to foreclosed homes, with people stealing copper plumbing from empty houses, causing flooding. The chief in Fitchburg, MA has correlated rising crime with the down economy. In 2½ months in late 2008 the small town had been hit by 22 robberies, where there are normally three or four robberies a month, and car thefts more than doubled.

Towards the end of 2008 the number of burglaries in St. Cloud, MN doubled within one month. "Whenever the economy takes a nose-dive, property crime increases," said John Justin with the St. Cloud Police.

Another sign of the times is the category of package-snatchers: people who see packages on front porches or near doors and quickly take them. These and many acts of shoplifting are often not reported to police.

So what does all this mean for you, other than fighting any feelings that your own awful financial situation tempts you to commit some type of property crime? It means that you need to be more vigilant in protecting your own property at home, when shopping and doing just about anything else outside your home. After all, money (or really the lack of it) is the root of so much evil. No surprise that when so many millions of Americans are losing jobs, savings, homes and health insurance, and government and private programs for the poor are being cut, their lack of money and their need to survive will all too often drive them to property crime. Whether this has some moral justification is up to you to decide. For certain, with no widespread economic recovery in sight, property crime is bound to rise sharply for some time.