Retail Sales Up Slightly in August; More Stimulus Needed
Clothing sales were up 2.9% month over month. (iStock/Antonio Diaz)
While retail and foodservice sales grew modestly in August, it’s clear that they could benefit from another stimulus, which many in the industry hope happens before the upcoming election.
The U.S. Census Bureau said today that overall retail and foodservice sales during August were up 0.6% from July and up 2.6% year over year. That follows a 0.9% month-over-month increase in July. Retail sales have been climbing for several months after a record monthly drop in April when most non-essential stores were closed.
While some pundits view sales as losing steam, National Retail Federation (NRF) President and CEO Matthew Shay said he believes “the consumer is resilient and is in good shape as we head into the holiday season,” despite agreeing that August sales numbers were a bit mixed.
“Over the past several months, consumers have responded well to federal relief measures that have supported the recovery, so it comes as no surprise that they would take a pause on spending as some of these programs tapered off at the end of July,” Shay added. “We continue to advocate for additional stimulus measures to help the economy recover. With the holidays quickly approaching, our retailers are prepared to serve customers to meet all of their holiday needs and are embracing the new holiday tradition of shopping early.”
NRF Chief Economist Jack Kleinhenz said August was “topsy-turvy as COVID-19 brought a lot of shifts and uncertainty regarding back-to-school spending and other issues” but that consumer spending remains intact.
“Retail spending habits have remained largely consistent and stable these past few months since stores began to reopen,” Kleinhenz added. “Some consumers likely reduced their spending with the end of the $600 supplemental unemployment benefits for those out of work, but a building up of savings from that and other government cash helped support spending. At this juncture, it is difficult to sort out how much economic activity is due to government support and how much is evidence of hardcore demand due to recent job gains. August numbers might have been higher if not for small businesses struggling with reopening and the return to full operations.”
NRF said its calculation of retail sales — which excludes automobile dealers, gasoline stations and restaurants in order to focus on core retail — showed August was up 0.1% from July and up 5.6% year over year. NRF’s results are different from the Census Bureau’s figures because of the categories that are excluded. NRF said its numbers were up 8.5% year over year on a three-month moving average.
Just over half of retail categories saw month-over-month gains and two-thirds saw year-over-year increases, according to the NRF, with the biggest monthly gain at clothing stores, although their sales remain far below last year.
Specifics from key retail sectors during August include:
• Clothing and clothing accessory stores were up 2.9% month over month but down 23.5% year-over-year.
• Furniture and home furnishings stores were up 2.1% month over month and up 0.4% year overyear.
• Building materials and garden supply stores were up 2% month over month and up 11.9% year over year.
• Electronics and appliance stores were up 0.8% month over month but down 3.4% year over year.
• Online and other non-store sales were unchanged month over month but up 20.1% year over year.
• Health and personal care stores were up 0.8% month over month and up 3.3% year over year.
• General merchandise stores were down 0.4% month over month and down 0.2% year over year.
• Grocery and beverage stores were down 1.2% month over month but up 8.3% year over year.
• Sporting goods stores were down 5.7% month over month but up 8% year over year.