April 11, 2022

Alger is widely recognized as a pioneer of growth-style investing.

Examining the Post-Pandemic Economy

While sheltering in place during the pandemic, Americans engaged in a feeding frenzy on consumer goods that helped fuel inflation. Consumers now appear positioned to shift their spending to restaurants, travel, entertainment and other services as the pandemic recedes. This dramatic shift could potentially create attractive opportunities for innovative companies that are best positioned to benefit from the economy reopening and it could help counter inflationary pressures.

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As a percentage of spending, goods leaped from 31% in early 2020 at the beginning of the pan

demic to a high of 36% (see above). Consumer services during the same period dropped from

69% to 64%.

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Splurging on goods sparked more than a flurry of delivery trucks to homebound Americans—it

created pent up demand for entertainment and other services while overwhelming the supply

chain, which we believe contributed to inflation reaching levels not seen in approximately 40 years.

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As the pandemic recedes and people have more opportunities for entertainment experiences,

the spending trend could potentially reverse and create demand for services such as travel, live

entertainment and dining. If consumer purchases return to pre-pandemic patterns, we believe

as much as $700 billion in annual spending may shift from goods to services.

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This potential shift could provide strong growth opportunities for businesses that are best posi

tioned to disrupt the consumer services industry with innovative products and services. Potential

examples include online travel platforms, ride hailing services, concert promoters and restaurants

with compelling internet-based food ordering services. Businesses that support the travel industry,

such as companies that provide aircraft parts, could also benefit from this shift. Additionally, the

shift could potentially reduce pressure on the supply chain and help tame inflation.

Examining the Post-Pandemic Economy

While sheltering in place during the pandemic, Americans engaged in a feeding frenzy on

consumer goods that helped fuel inflation. Consumers now appear positioned to shift their

spending to restaurants, travel, entertainment and other services as the pandemic recedes.

This dramatic shift could potentially create attractive opportunities for innovative companies

that are best positioned to benefit from the economy reopening and it could help counter

inflationary pressures.

U.S. Percentage of Consumer Spending on Goods and Services

Source: U.S. Bureau of Economic Analysis.

2021

2022

2020

2019

2018

2017

2016

2015

2014

2013

2012

GOODS (%)

SERVICES (%)

PANDEMIC

STARTS

Fred Alger & Company, LLC

100 Pearl Street, New York, NY 10004 / www.alger.com

800.305.8547

(Retail)

/ 800.223.3810

(Institutional)

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The views expressed are the views of Fred Alger Management, LLC as of March 2022. These views are subject to change at any time and may not represent the views of all

portfolio management teams. These views should not be interpreted as a guarantee of the future performance of the markets, any security or any funds managed by Fred

Alger Management, LLC. These views are not meant to provide investment advice and should not be considered a recommendation to purchase or sell securities.

This material must be accompanied by the most recent fund fact sheet(s) if used in connection with the sale of mutual fund and ETF shares.

Risk Disclosure: Investing in the stock market involves certain risks, including the potential loss of principal.

Growth stocks may be more volatile than other stocks

as their prices tend to be higher in relation to their companies’ earnings and may be more sensitive to market, political, and economic developments. Technology companies

may be significantly affected by competition, innovation, regulation, and product obsolescence, and may be more volatile than the securities of other companies. Local,

regional or global events such as war, acts of terrorism, the spread of infectious illness such as COVID-19 or other public health issues, recessions, or other events could have a

significant impact on investments.