Retail Sales Growth measures consumer spending patterns and is one of the most useful indicators for forecasting the economy. It’s the quantity of goods and services purchased by consumers and businesses. Retail sales accounts for over two thirds of the country’s gross domestic product. Because of this, if a recession is looming it is one of the first markers to exhibit signs of contraction.
The Retail Sales figure is reported by the U.S. Census Bureau in the middle of every month in its Advance Monthly Sales for Retail and Food Services report. It’s important to note that the Census Bureau doesn’t adjust for inflation in calculating this metric. The monthly report breaks down the retail indicator into thirteen categories.
- Motor Vehicle and Parts Dealers
- Non-store Retailers
- Food and Beverage Stores
- Food Services and Drinking Places
- General Merchandise Stores
- Gasoline Stations
- Health and Personal Care Stores
- Building Materials and Garden Equipment and Supplies Dealers
- Clothing and Clothing Accessories Stores
- Miscellaneous Store Retailers
- Furniture and Home Furnishings Stores
- Electronics and Appliance Stores
- Sporting Goods, Hobby, Musical Instrument, and Book Stores
As an example of the scope of each category, in January 2020 the top five categories made up almost 70% of all of the retail and food services expenditures. Motor Vehicle and Parts Dealers represented the largest share at 19.4%. Non-store Retailers came in second at 13.4%, Food and Beverage Stores accounted for 13.2%, and Food Services and Drinking Places, and General Merchandise Stores registered in at 4th and 5th with 12.6% and 11%.
Throughout the prosperous 1990’s retail sales growth regularly grew between 4% and 7% year after year, however since the Great Recession, the economy has been slow to rebound to those levels. Despite a significant increase of 7.32% in 2011, over the last nine years the retail sales indicator has lagged at levels between 2% and 5%.
The table and graph below break-down the monthly average and annual percent change of the United States’ Retail Sales and Food Services metric. This indicator is usually compared on a year over year basis due to seasonal changes.