Consumers’ willingness to spend overcame inflation again in August as more jobs and higher wages helped ease some of the pressure of continuing high prices, according to the National Retail Federation (NRF).
“August retail sales show consumers’ resiliency to spend on household priorities despite persistent inflation and rising interest rates,” said NRF President and CEO Matthew Shay. “As we gear up for the holiday season, consumers are seeking value to make their dollars stretch. Retailers have been hard at work managing their supply chains and holiday inventories to provide consumers with great products, competitive prices, and convenience at every opportunity. We are relieved and cautiously optimistic that the potentially devastating rail strike has been averted, and we appreciate the Biden administration’s intervention on behalf of businesses and consumers. We hope railway workers will accept the new terms of the proposed contract.”
“Household spending remains steady even as costs continue to rise,” said NRF Chief Economist Jack Kleinhenz. “Consumers continuing to spend more each month points to the benefits of strong job and wage growth and their use of pandemic savings to help handle persistent elevated prices. Consumers are showing their toughness, but they have limited options and cannot continue if prices do not begin to soften. This retail sales report comes amid mixed signals from the broader economy that show the headwinds against the consumer are strengthening.”
The US Census Bureau said that overall retail sales in August were up 0.3 percent from July and up 9.1 percent year over year. That compared with a month-over-month decline of 0.4 percent and a year-over-year increase of 10.1 percent in July. On a three-month moving average, sales were up 9.3 percent year over year.
NRF’s calculation of retail sales—which excludes automobile dealers, gasoline stations, and restaurants to focus on core retail—showed August was up 0.1 percent from July and up 8 percent unadjusted year over year. In July, sales were up 0.5 percent month-over-month and up 7.2 percent year-over-year.
NRF’s numbers were up 7.3 percent unadjusted year-over-year on a three-month moving average as of August. Sales were up 7.5 percent year-over-year for the first eight months of the year, keeping results on track with NRF’s forecast that 2022 retail sales will grow between 6 percent and 8 percent over 2021.
August sales were up in all but one retail category on a yearly basis, led by building material stores, online sales, and grocery stores, and increased in all but four categories on a monthly basis. Specifics from key sectors include:
- Building materials and garden supply stores were up 1.1 percent month-over-month seasonally adjusted and up 13.4 percent unadjusted year-over-year.
- Online and other non-store sales were down 0.7 percent month-over-month seasonally adjusted but up 12.3 percent unadjusted year-over-year.
- Grocery and beverage stores were up 0.5 percent month-over-month seasonally adjusted and up 8 percent unadjusted year-over-year.
- Sporting goods stores were up 0.5 percent month-over-month seasonally adjusted and up 7.1 percent unadjusted year-over-year.
- Clothing and clothing accessory stores were up 0.4 percent month-over-month seasonally adjusted and up 3.7 percent unadjusted year-over-year.
- Health and personal care stores were down 0.6 percent month-over-month seasonally adjusted but up 3.7 percent unadjusted year-over-year.
- General merchandise stores were up 0.5 percent month-over-month seasonally adjusted and up 3.2 percent unadjusted year-over-year.
- Furniture and home furnishings stores were down 1.3 percent month-over-month seasonally adjusted but up 0.1 percent unadjusted year-over-year.
- Electronics and appliance stores were down 0.1 percent month-over-month seasonally adjusted and down 5.2 percent unadjusted year-over-year.