Spring Fling: Shoppers Emerged for a 1.2% Sales Increase in May

In What's New, Industry News by Accessories Staff

US-retail-sales-May-2015Washington—Shoppers may not be MIA after all. According to data reported by the U.S. Department of Commerce today, U.S. retail sales rose 1.2% in May to $444.9 billion, following a 0.2% increase in April.

What’s more, increases were seen across a broad range of categories. Of the 13 major retail categories tracked by the Commerce Department, 11 of them had growth. That included a 1.5% increase at clothing and accessories stores, a 1.4% rise in nonstore retailers. Only health and personal care stores failed to show increases.

“The consumer took a month off and came back and spent in style,” said Ward McCarthy, chief financial economist at Jefferies LLC, who had forecast the May increase. “Consumers’ behavior has been inconsistent, but the trend has been for gradual acceleration of spending.” (Economists had estimated a 1.3% gain in May.)

‘Regaining Momentum’

At the National Retail Federation (NRF) Chief Economist Jack Kleinhenz said, “With income, employment and consumer confidence all improving, consumers were encouraged to open their wallets this spring. Retail sales gains were evident across business sectors with the one exception being health and personal care stores. The improvement in retail sales is consistent with employment gains and the recent uptick in consumer credit. On the whole, sales are growing at a reasonable pace and regaining momentum.”

“Latest economic data show improvement in the economy and we expect stronger sales growth as jobs and income pick up. Nonetheless stronger wage growth is needed to sustain further gains in retail sales.”

Retail sales minus autos increased 1%, according to the Commerce Department, after a 0.1% gain in April.

The figures for March was revised up to show a 0.9% gain compared with a previously reported 0.5% advance, which should boost first-quarter consumer spending when the figures are updated later this month.

Economists blamed winter storms, delays related to a labor dispute at West Coast ports and a stronger dollar for causing the U. S. economy to narrow to 0.7% annual rate in from January through March. Household consumption climbed at a 1.8% pace, less than half the 4.4% recorded in the previous three months.

Economists last month projected consumer spending to accelerate to a 3.2% pace in the second quarter, Bloomberg News reported.

Moreover, the sales increases benefited from lower unemployment. Retailers have been adding new employees at a steady rate, a signal they expect sales to remain firm in the coming months, economists noted. About 135,000 workers have been first the first five months of this year.

 

 

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