JACKSON — Since the widespread economic meltdown started, Jimmy Stewart has witnessed a trend.

"People are shopping around, and they're trying to get discounts for services," said Stewart, vice president of Peoples Funeral Home in Jackson. "Most people are not in a position to pay the regular retail price of a funeral.

"You have to adjust your overhead to accommodate for the recession," Stewart said.

And so he's cut expenses — even laid off two employees and reduced hours.

His story is only part of the picture.

High unemployment. Continuing layoffs. Utility bills and mortgages. These things affect the fiscal health of many households. But despite the economic doldrums that erased discretionary spending for a slew of Americans, the flow of customers in the funeral business isn't governed by employment statistics.

"The recession doesn't stop death," Stewart said, "it's just people's ability to pay."

Exactly how is the funeral industry faring in the economic downturn?

"If you asked that question to 10 different funeral directors, you would get 10 different answers," said John Reed, immediate past president of the National Funeral Directors Association and owner of two funeral homes in West Virginia.

How a funeral business fares in this economy depends on whom is being served and — in some cases — the local economy.

Reed's rural West Virginia community is in a coal mining area that has depleted most of its resource. Among those not using insurance to pay for funerals, Reed sees more requests for payment plans, more interest in getting loans to pay for funerals and people cutting back on spending by buying cheaper caskets.

Stewart has seen more direct burials, funerals that don't include embalming and place the deceased in the ground within 48 hours. Direct burials run around $2,500, compared to the $5,000 to $6,000 average cost of traditional funerals at his business.

"Business has been very good for us the last two years," Michael Hudgins, director of Natchez Trace Funeral Home, Memorial Park and Crematory in Madison, said.

The story is similar at Wright & Ferguson Funeral Directors, although general manger Ellis Wright said pre-need contracts dropped about 15 percent last year, but have recovered by the same amount so far this year.

In the funeral industry, the public's fiscal struggle shows in several choices — everything from asking the public to help pay for the funeral to whether pre-need policies have been purchased.

Figures from the secretary of state's office show the value of pre-need contracts fell by about 13.1 percent to nearly $38.6 million between 2007 and 2008, the latest data available.

"People have dropped their burial insurance," Audrey Wiley, an owner at Westhaven Memorial Funeral Home, said. "They're trying to keep up the basics — utilities, keeping the lights on, making sure their health insurance is paid."

Stewart said he's seeing more pre-need contracts.

"People don't want to leave their survivors in a jam," said Stewart, who added that pre-need contracts are being marketed more.

Cremation Mississippi has the lowest rate of cremations in the nation, about 11.3 percent in 2008, the Cremation Association of North America reported. That's up from almost 10.4 percent in 2007. The same preliminary 2008 figures show more than 36 percent of the dead were cremated nationally, up from the nearly 34.8 percent in 2007. Cremations are expected to rise to more than 46 percent by 2015.

Cremations have increased, but some say the growth reflects a trend that predates the recession.

Hudgins' business, for example, added a crematorium two years ago, explaining why his volume increased 100 percent. The business only cremates its own customers.

A basic cremation can cost $1,950 compared to an average funeral that can cost around $7,000, excluding burial costs, Hudgins said. A cremation service that includes viewing of the body runs around $5,000.

Hudgins said his customers aren't choosing cremations for economic reasons.

Mollie Murphey cremated her son, 20-year-old Jake Heath who died unexpectedly in 2008, and both of her parents.

Her son's cremation at Natchez Trace Funeral Home wasn't for economic reasons, although she estimates a $2,000 savings by cremating and burying the ashes.

"If I would have wanted to bury (a body), it wouldn't have mattered what it would have cost," Murphey said.

Her parents' story is different. Her father died in 2003 and her mother died earlier this year. The El Paso, Texas, residents wanted to have their ashes spread together in the Gulf of Mexico. She didn't recall the financial details of her father's service, but estimated cremation saved $3,500 with her mother's service.

"They thought to get a fancy casket and bury it under the ground was a waste of money," Murphey said. "They were both children of the Depression."

Wiley said some of her customers' increased interest in cremations has been for economic reasons. About 4 to 5 percent were cremated in recent years. By last year, the number had risen to 10 percent.

Financing options Those unable to pay for a funeral with cash, check, credit card or an insurance policy sometimes turn to finance companies. As with other aspects of the industry, the vibrancy of the funeral loan business varies.

Eighteen months ago, 15 percent of Greenville, S.C.-based American Funeral Financial's business was financing funerals. Now it's down to 2 percent.

CEO Chuck Gallagher blames the decline — and his 2 percent approval rate — on the tightening credit market. The economic strain that forces some to look for funeral loans is often the thing that keeps them from qualifying.

About 85 percent of Gallagher's business is dedicated to providing cash to those waiting on an insurance settlement and about 13 percent is funeral-related debt collection.

"Generally, people have the desire (to pay)," Gallagher said, explaining that because of the economy many are unable to pay.

Forced to choose between paying the mortgage or paying for a funeral, many choose to meet their living expenses.

Business at Funeral Loan Finance is strong. The company used to get about five to 10 funeral loan applications a week. The number now averages between 30 and 40, said Jim Axford, president of Axford Enterprises, which operates Funeral Loan Finance and seven other companies.

His funeral loans average from $4,000 to $8,000 and interest rates range from 3.9 percent to 17.99 percent. Approval rates range from 30 to 40 percent. Payment terms vary. Some loans are repaid over 36 months. Others come with credit card-style terms that have no set end date for the loan.

The Overland Park, Kan.-based company will add 200 to 300 sales reps in the next two months, Axford said.

"We'll continue to market more because the opportunity is there, and I think as the baby boomers get older and with the economy, they are going to be looking for ways to come up with money if something happens," Axford said.