Despite occasional month-over-month declines, sales have grown year-over-year every month since June 2020, according to Census data.

Clothing sales edged up 0.1% month-on-month in August, according to data released by the US Census Bureau. Sales surged by 38.8% compared to the same period a year ago when they were still suppressed from the pandemic.

National Retail Federation (NRF) president and CEO Matthew Shay notes in spite of the ongoing challenges of the global pandemic, concerns about the delta variant, and supply chain and workforce constraints, the retail industry continues to do what it does best – serve customers and support communities while keeping team members and associates safe and healthy.

“We maintain our confidence in the historic strength of consumers and fully expect a record year for retail sales and a strong holiday season for retailers.”

NRF chief economist Jack Kleinhenz adds: “Retail sales in August overcame unusual twists and turns that have affected shopping behaviour both in terms of the timing and composition of sales. The consumer remains rock solid despite the trifecta of macroeconomic headwinds we’ve seen this year, including tapering off of government stimulus, elevated Covid-19 infections and ongoing supply chain challenges in the form of shortages of labour and goods. Higher sales came even with a disjointed back-to-school season that also affected the timing of sales as many school districts returned to in-person learning but some delayed classes until after Labor Day. These results pave the way for sturdy consumer spending and a strong economy in the fourth quarter.”

NRF’s calculation of retail sales – which excludes automobile dealers, gasoline stations and restaurants to focus on core retail – showed August was up 2.3% seasonally adjusted from July and up 12% unadjusted year-over-year. That compared with a month-over-month decrease of 1.8% and a year-over-year increase of 8.9% in July.

NRF’s numbers were up 11.4% unadjusted year-over-year on a three-month moving average.

For the first eight months of the year, sales, as calculated by NRF, were up 15% over the same period in 2020. That is consistent with NRF’s revised forecast that 2021 retail sales should grow between 10.5-13.5% over 2020 to between $4.44-$4.56 trillion.

August sales were up in all but two categories on a monthly basis and up across the board year-over-year, led by increases at clothing, sporting goods and electronics stores.

Clothing and clothing accessory stores were up 0.1% month-over-month seasonally adjusted and up 36.6% unadjusted year-over-year.

Sporting goods stores, meanwhile, were down 2.7% month-over-month seasonally adjusted but up 20.3% unadjusted year-over-year.

Clothing stores the standout winner

Neil Saunders, managing director of GlobalData, notes as the country moved into summer, American consumers continued to spend at pace, which helped push up overall retail sales by 15.4% over the prior year.

“In monetary terms, this equates to an $83.8bn increase – the equivalent of every person spending an additional $260 during the month. The level of growth was aided by the fact that August of last year was a flat month for retail due to the sector losing momentum as some enhanced unemployment benefits came to an end. This softer comparative flatters the 2021 results and hides a very modest slowdown in growth. This shows up in the two-year figures where, compared to the same period in 2019, August retail sales grew by 15.4% which is a lower rate of expansion than July’s 19.1% uplift and June’s 22.6% rise.”

While the general trajectory does not detract from the still very solid results being produced for retail, Saunders says it does underline GlobalData’s long-held view that stellar growth rates will start to moderate as we come into the back end of the year.

He explains: “This is especially so as stimulus benefits fade, and prior-year comparatives become a lot tougher. Retail will end the year well up over both 2020 and 2019, which is a clear win, but retailers should not consider the heady growth of the past few months as the new normal.

He adds: “Under the headline number, core retail – which excludes gasoline, food service, and automotive vehicles – saw sales increase by 12% over the prior year. In monetary terms, consumers spent an additional $41bn compared to August 2020. Core retail continues to benefit from an influx of spend from other activities such as vacations and travel which have been curtailed because of the pandemic, and rising concerns over the delta variant. This can be seen from food service spend, which fell by 2.8% compared to last month, because of a greater reluctance among some consumer segments to dine out. As we come into the winter months, there is a possibility that the virus could worsen and that this shift in spending from services to products could be heightened. This, while an unfortunate outcome for society and the economy as a whole, would be helpful during retail’s golden quarter and could provide a small fillip at the end of the year.

“Within core retail, clothing stores were the standout winner with a 36.6% uplift in sales over the prior year. Against August of 2019, sales were up by 8.7%. The sector benefitted from more consumers refreshing closets as well as a robust start to back-to-school. Inflation also gave an edge to growth as there were far fewer discounts and offers during the month compared to previous years which meant more consumers bought at full-price than normal.

“In terms of channels, non-store retail grew by 10.6% this month, which is something of a rally after last month’s dismal growth of 1.8%. Some of this is down to the delta variant driving more people online, especially during the back-to-school shopping period. Even so, non-store penetration continues to fall from the high levels of 2020.

“Looking ahead, we maintain our view that retail will end the year on a very solid note. Growth will moderate over the coming months, but the consumer still has plenty of firepower to give retail a happy send-off as we exit 2021.”

By Just Style
https://drive.google.com/file/d/1NH1yZKX51P3BR0pENu2YuOCEH51m7sdk/view?usp=sharing