Cold Weather, Economic Policy Dampen March Retail Sales
Consumer spending declined in March as the impact of colder weather and harmful fiscal policy, namely the payroll tax hike, caught up to the economy and weakened retail sales.
According to the National Retail Federation (NRF), March retail sales (excluding automobiles, gas stations and restaurants) decreased 0.2 percent seasonally adjusted from last month and increased 1.6 percent unadjusted year-over-year.
"Retail is the vehicle that drives our economy, and the consumer dictates the speed,” said Matthew Shay, NRF president and CEO. “With consumer confidence low, Washington decision makers need to focus on a long-term, economic roadmap that creates fiscal certainty for American families."
“We need policies that encourage job growth and capital investment by business generally and the retail industry specifically, an industry that supports one in four American jobs,” Shay added. “Without either, economic recovery will continue to sputter along, and the consumer will keep their foot off the pedal.”
According to the U.S. Department of Commerce, March’s total retail and food services sales (which include non-general merchandise categories such as automobiles, gasoline stations and restaurants) decreased 0.4 percent seasonally adjusted month-to-month and increased 2.8 percent adjusted year-over-year.
“The fall off in spending is no surprise,” said Jack Kleinhenz, NRF chief economist. “A colder-than-usual winter, an anemic employment picture and delays in tax refunds impacted consumer spending across the board in March. While we remain optimistic that retail sales will grow modestly this year, it seems like the economy is off to a shaky start as we enter the second quarter.”
Other findings from NRF include:
- Building material & garden equipment and supplies dealers stores’ sales increased 0.1 percent seasonally-adjusted and decreased 2.1 percent unadjusted year-over-year.
- Clothing and clothing accessories stores' sales increased 0.1 percent seasonally-adjusted month-to-month and increased 3.1 percent unadjusted year-over-year.
- Electronics and appliance stores’ sales decreased 1.6 percent seasonally-adjusted month-to-month and decreased 4.5 percent unadjusted year-over-year.
- Furniture and home furnishing stores’ sales increased 0.9 percent seasonally-adjusted month-to-month and increased 0.8 percent unadjusted year-over-year.
- General merchandise stores’ sales decreased 1.2 seasonally-adjusted month-to-month and decreased 3.6 percent unadjusted year-over-year.
- Health and personal care stores’ sales were decreased 0.3 seasonally-adjusted month-to-month and decreased 0.8 percent unadjusted year-over-year.
- Nonstore retailers’ sales increased 0.3 percent seasonally-adjusted month-to-month and increased 10.1 percent unadjusted year-over-year.
- Sporting goods, hobby, book and music stores’ sales decreased 0.8 percent seasonally-adjusted month-to-month and increased 4.5 percent unadjusted year-over-year.
NRF represents retailers of all types and sizes, including chain restaurants and industry partners, from the U.S. and more than 45 countries abroad.