Winter Storms Slow US Retail Sales
US retail sales faltered in February as winter storms impacted consumers’ ability to shop, the National Retail Federation (NRF) said.
Revenues slipped 3% versus January’s total, with major snowstorms hitting the country’s northeast, and ice storms in the south cutting power in many locations, according to data the US Census Bureau reported Tuesday. Government stimulus checks, increased Covid-19 vaccinations, and reduced restrictions also buoyed January’s figures. However, February sales were up 6% compared to the same month in 2020.
“February’s retail sales numbers are a minor speed bump on the road to post-pandemic recovery, and are not a reflection of consumers’ willingness and ability to spend and drive the economy,” noted NRF CEO Matthew Shay.
The Internal Revenue Service’s (IRS) delay in when it started accepting tax returns pushed back the release of refunds, which also affected February spending, explained NRF chief economist Jack Kleinhenz. Despite the monthly decline, sales have grown year on year every month since June.
Eight out of the nine retail categories the US Census Bureau monitors experienced month-on-month declines in February, with groceries being the exception. Clothing and accessories, which includes sales of jewelry, fell 2.8% over January and 15% year on year.
The NRF expects sales to recover as better health and financial situations lead to improved consumer sentiment.
“Overall, February’s results confirm that consumers are willing to spend as the virus situation improves and continued government stimulus further strengthens the economic backdrop,” Kleinhenz added. “With another round of stimulus checks being mailed right now, we expect another large boost in consumer spending over the next few months.”
Retailers also expect sales to pick up, according to NRF’s Global Port Tracker report, released in partnership with Hackett Associates. Retail imports are predicted to grow dramatically during the first half of the year, as retailers bring in “huge amounts” of merchandise to meet demand, said Jonathan Gold, NRF vice president for supply chain and customs policy.
“The supply chain slowdown we usually see after the holiday season never really happened this winter, and imports are already starting to grow again,” he added. “Consumers haven’t let the pandemic stop them from shopping, and retailers are making sure their customers can find what they want.”