Tag: Retail Spending

Retail Sales Were Unchanged in July, Slowing from a Faster Pace in the Spring Months

The Census Bureau said that retail sales were unchanged in July. Since declining due to winter weather in December and January, retail spending had rebounded in the spring months, but it has since slowed significantly. Over the course of the past 12 months, retail sales have risen 3.7 percent, down from a 4.7 percent pace experienced in April. As such, it appears that consumers have become more cautious in their spending this summer even as we have continued to see relatively modest gains so far in 2014.

Motor vehicle sales (down 0.2 percent) declined for the second month in a row. Excluding auto sales, retail spending was up just 0.1 percent, indicating broader weaknesses. Bright spots included miscellaneous store retailers (up 0.9 percent), clothing and accessory stores (up 0.4 percent), health and personal care stores (up 0.4 percent), food and beverage stores (up 0.3 percent), food services and drinking places (up 0.2 percent) and sporting goods and hobby stores (up 0.2 percent).

Yet, these gains were largely offset by spending declines for department stores (down 0.7 percent), motor vehicle and parts dealers (down 0.2 percent), electronics and appliance stores (down 0.1 percent), furniture and home furnishings stores (down 0.1 percent) and nonstore retailers (down 0.1 percent).

On a year-over-year basis, segments with the fastest retail sales growth were health and personal care stores (up 7.3 percent), food services and drinking places (up 6.2 percent), motor vehicle and parts dealers (up 6.0 percent), nonstore retailers (up 5.9 percent) and building material and garden supply stores (up 5.1 percent).

Chad Moutray is the chief economist, National Association of Manufacturers. 

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Reduced Auto Sales Slowed Overall Retail Spending in June

The Census Bureau said that retail sales were up 0.2 percent in June, its slowest pace since January. The consensus expectation had been for retail spending levels closer to the 0.6 percent and 0.5 percent paces seen in April and May, respectively. Despite the slower levels of activity in July, the year-over-year pace continues to grow at decent levels, up 4.3 percent over the past 12 months. This was lower than the 4.6 percent pace observed the month before, but faster than the 1.8 percent year-over-year rate observed in January.

Spending on motor vehicles and parts declined 0.3 percent in June, its first decrease in six months. Still, the larger story for autos remains a positive one, with 6.4 percent growth year-over-year. If you were to exclude autos, retail spending would have grown by 0.4 percent for the month and 3.7 percent over the past 12 months. The year-over-year pace for retail spending excluding autos was up from 3.4 percent in May and was the fastest pace in 11 months.

Therefore, the news was perhaps more positive than the top-line figure might suggest. Areas with higher retail spending in the month of July included health and personal care stores (up 0.9 percent); nonstore retailers (up 0.9 percent); clothing and accessory stores (up 0.8 percent); sporting goods, hobby, book and music stores (up 0.6 percent); food and beverage stores (up 0.4 percent) and gasoline stations (up 0.3 percent). Beyond autos, building materials and garden supply stores (down 1.0 percent) and food services and drinking places (down 0.3 percent) also had decreased retail spending for the month.

Chad Moutray is the chief economist, National Association of Manufacturers. 

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Retail Spending Growth Slowed in May

The Census Bureau said that retail sales increased 0.3 percent in May. On the positive side, this was the fourth consecutive monthly increase in retail spending, rebounding from winter-related softness in both December and January. Since November (pre-dating the storms), retail sales have risen 2.2 percent, and year-over-year, they have grown 4.3 percent. Yet, the pace of growth was slower than anticipated, or half of the consensus expectation of 0.6 percent. May’s increase was down from the 1.5 percent and 0.5 percent gains experienced in March and April, respectively.

Moreover, when you exclude autos and gasoline purchases from the analysis, retail spending was unchanged for the month, suggesting broader weaknesses. Motor vehicle and parts sales were up 1.4 percent in May, extending sales increases since January and continuing a strong trend. Auto sales have grown 10.4 percent over the past 12 months. Meanwhile, gasoline station sales rose 0.9 percent and 0.4 percent in April and May, respectively. This was primarily due to higher petroleum costs, with West Texas intermediate crude costs up from $99.69 per barrel on April 1 to $103.40 a barrel on May 30.

Data from other sectors were mostly mixed. Americans spent more in May at miscellaneous store retailers (up 1.8 percent), building materials and garden supplies stores (up 1.1 percent), nonstore retailers (up 0.6 percent), and furniture and home furnishings stores(up 0.5 percent). In contrast, these increases were offset by declines for clothing and accessories (down 0.6 percent), general merchandise (down 0.6 percent), electronics and appliances (down 0.3 percent), food services and drinking places (down 0.2 percent), food and beverages (down 0.1 percent), and health and personal care (down 0.1 percent) stores.

Chad Moutray is the chief economist, National Association of Manufacturers.

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Retail Spending Began to Rebound in February

The Census Bureau said that retail sales increased 0.3 percent in February. This was a partial rebound from the weather-induced declines of 0.3 percent and 0.6 percent in December and January, respectively. Retail sales peaked at an all-time high of $430.1 billion in November, but have fallen 0.7 percent since then. As a result, the year-over-year pace of retail spending has also decelerated in that time period, down from 4.0 percent in November to 1.5 percent in February.

The largest monthly gains in retail sales occurred in sporting goods, hobby, book and music stores (up 2.5 percent); nonstore retailers (up 1.2 percent); and health and personal care stores (up 1.2 percent) businesses. In the first two, these were bounce-backs from declines the month before.

The bigger story was the beginning of possible “green shoots” on the sales front in February for some retailers. For instance, motor vehicle sales were hard hit by poor weather conditions in both December and January (down 2.1 percent and 2.0 percent, respectively). In February, auto sales rose a very modest 0.3 percent, ending the downward streak. Similar shifts were seen for department stores (up 0.7 percent), clothing and accessories (up 0.4 percent), furniture and home furnishings (up 0.4 percent), and food service and drinking places (up 0.3 percent). This indicates that people have started to come back into these establishments – a positive development even if the increases have not fully offset the prior decreases.

Areas with continued weaknesses included miscellaneous store retailers (down 0.9 percent), general merchandise stores (down 0.3 percent), electronics and appliances (down 0.2 percent), and food and beverage stores (down 0.2 percent).

Chad Moutray is the chief economist, National Association of Manufacturers.

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Retail Spending Fell for the Second Straight Month in January

The Census Bureau reported that retail sales fell 0.4 percent in January, extending the 0.1 percent decline observed in December. A significant drop in auto sales over the past two months was a major factor, with spending on motor vehicles and parts down 1.8 percent and 2.1 percent in December and January, respectively. Indeed, if you were to exclude autos from the analysis, retail spending would have been unchanged in January.

As with so many other indicators of late, weather was likely a contributing factor. If people are not able to get to the stores to make purchases, the overall spending numbers are bound to reflect that. As a result, we have seen the year-over-year retail sales numbers decelerate, down from 4.0 percent in November to 3.5 percent in December to 2.6 percent in January.

The sector-by-sector breakdown for January was largely mixed, as you might expect given that it was flat for the broader (non-auto) market. There were increases in spending for building materials (up 1.4 percent), gasoline stations (up 1.1 percent), electronics and appliances (up 0.4 percent), and food and beverages (up 0.2 percent). But, these were essentially offset by declines for department stores (down 1.5 percent), sporting goods and hobbies (down 1.4 percent), clothing and accessories (down 0.9 percent), furniture and home furnishings (down 0.6 percent), health and personal care (down 0.6 percent), nonstore retailers (down 0.6 percent), and food services and drinking places (down 0.6 percent).

Chad Moutray is the chief economist, National Association of Manufacturers.

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Retail Sales Growth Eased Somewhat in December, Pulled Lower by Weaker Monthly Auto Sales

The Census Bureau said that retail sales rose 0.2 percent in December, somewhat slower than the revised 0.4 percent pace observed in November. Retail spending increased 4.1 percent in 2013. While this suggests modest growth overall for consumer purchases, it also means that retail sales growth has decelerated from the rates observed in the prior three years, down from the year-over-year rates of 6.7 percent, 6.2 percent, and 5.2 percent in 2010, 2011, and 2012, respectively.

Sales of motor vehicles and parts were one of the larger drags to retail sales growth in December, down 1.8 percent. Still, automobile sales were up nearly 1 percent in the fourth quarter and 6 percent for the year, and they continue to be a bright spot in the overall economy.

Excluding autos from the analysis, retail sales would have risen 0.7 percent in December, up from 0.1 percent in November. This indicates a pickup in spending in the broader market – definitely a good sign. Indeed, the year-over-year rate for non-auto retail sales has accelerated from 2.7 percent in October to 3.7 percent in December. This broader category rose 1.2 percent in the fourth quarter.

Segments with higher retail spending in December included food and beverage stores (up 2.0 percent), clothing and accessories retailers (up 1.8 percent), gasoline stations (up 1.6 percent), nonstore retailers (up 1.4 percent), and health and personal care stores (up 0.6 percent), and food services and drinking places (up 0.5 percent).

In 2013, the fastest growth in retail sales was observed in the following: nonstore retailers (up 9.9 percent), motor vehicle and parts dealers (up 5.9 percent), clothing and accessory stores (up 5.2 percent), sporting goods and hobby stores (up 4.8 percent), health and personal care stores (up 4.7 percent), food services and drinking places (up 4.6 percent), furniture and home furnishings retailers (up 4.5 percent), and food and beverage stores (up 4.2 percent).

Chad Moutray is the chief economist, National Association of Manufacturers.

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Retail Sales Grew Strongly in October and November

The Census Bureau said that retail sales rose 0.7 percent in November. This extended the gains of October, which were revised up from the earlier estimate of 0.4 percent to a 0.6 percent increase. On a year-over-year basis, retail spending has picked up over the past two months, up from 3.5 percent in September to 4.1 percent in October to 4.7 percent in November. Still, this represents some deceleration from the 6.0 percent pace observed in June.

Motor vehicle sales were once again one of the bright spots, up 1.8 percent for the month and 10.2 percent over the past year. Growth in auto spending has rebounded from some weaknesses in the July to September timeframe, which is a definite positive.

The auto sector’s healthy increases skewed overall retail sales higher, but the broader market also reflected decent gains. Excluding autos, retail sales would have risen by 0.4 percent in November, with 3.5 percent year-over-year increases. Indeed, the broader segments beyond motor vehicles have also seen an acceleration in spending, with the annual pace in November up from 2.8 percent in both September and October. The year-over-year rate of non-auto retail spending peaked at 4.5 percent in June.

Other segments with higher retail spending in October included nonstore retailers (up 2.2 percent), building materials (up 1.8 percent), food services and drinking places (up 1.3 percent), furniture and home furnishings (up 1.2 percent), and electronics and appliances (up 1.1 percent). Among those with declining sales were miscellaneous store retailers (down 1.3 percent) and gasoline stations (down 1.1 percent). The drop in gasoline station sales stemmed from lower prices for its product, with the cost of West Texas intermediate crude falling from an average of $100.54 per barrel in October to $93.86 a barrel in November.

Chad Moutray is the chief economist, National Association of Manufacturers.

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Retail Sales Were Disappointing in September, Up Modestly Over the Past Year Overall

The Census Bureau said that retail sales decreased 0.1 percent in September, its first decline since March. We have seen the pace of overall retail spending decelerate over the past few months. The growth rate of retail sales over the past 12 months has fallen from 6.0 percent in June to 4.6 percent in August to 3.2 percent in September.

Motor vehicle sales were off 2.2 percent in September, skewing the overall data lower. In fact, if you were to exclude autos from the analysis, retail sales would have risen 0.4 percent. The non-auto year-over-year pace of retail sales was 2.8 percent, down from 4.4 percent in July and 3.2 percent in August. Still, motor vehicle sales have largely been a positive for consumer spending, with auto purchases up 5.1 percent over the past 12 months and 15.8 percent over the past two years.

Outside of automobiles, retail spending was up modestly, as just noted. Retailers with the largest gains in September included grocery stores (up 1.0 percent); food services and drinking places (up 0.9 percent), electronics and appliances (up 0.7 percent); sporting goods, hobby, book and music stores (up 0.5 percent); general merchandise stores (up 0.4 percent); and nonstore retailers (up 0.4 percent).

These were somewhat offset by declining sales for the month for miscellaneous store retailers (down 1.2 percent), department stores (down 0.9 percent), and clothing and accessory stores (down 0.5 percent). Gasoline station sales were a nonfactor this month, with no change from August in overall spending.

Looking at longer-term trends, segments with the greatest gains in year-over-year retail spending were: nonstore retailers (up 8.9 percent), miscellaneous store retailers (up 6.2 percent), building material and garden supply stores (up 5.8 percent), motor vehicle and parts dealers (up 5.1 percent), furniture and home furnishing retailers (up 4.3 percent), and food services and drinking places (up 4.2 percent). Department store sales had the largest weaknesses, with retail sales down 6.0 percent over the past 12 months.

Chad Moutray is the chief economist, National Association of Manufacturers.

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Increased Auto Sales Lift Retail Spending

The Census Bureau announced that retail sales rose 0.5 percent in December, its fifth expansion in the past six months. Over the course of 2012, retails sales increased 4.7 percent, with some of its fastest growth stemming from the motor vehicle sector (up 1.6 percent for the month and 7.6 percent year-over-year). Other businesses with strong annual gains were nonstore retailers (up 12.6 percent), miscellaneous store retailers (up 9.9 percent), sporting goods and hobbies (up 9.1 percent), furniture and home furnishings (up 6.1 percent), and clothing and accessories (up 5.1 percent).

Overall, the key story centers on December’s decent gain in retail sales, and in particular, it suggests that growth in holiday spending was up modestly. This contrasts with reports elsewhere that said that holiday sales were weak, particularly at some stores. Indeed, the 4.7 percent year-over-year growth rate in retail sales was lower in 2012 than in either 2010 or 2011(7.0 and 6.6 percent, respectively).

With consumer confidence falling sharply in December and other headwinds from the fiscal cliff stalemate, the fact that consumer spending held up modestly was still a good sign, and the slower pace can easily be explained.

Chad Moutray is chief economist, National Association of Manufacturers.

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