This is an excerpt from our most recent Economic Outlook report. To access the full PDF, please click here.
We are midway thru the typically strong seasonal Christmas holiday shopping season.
Let’s tap the best U.S. retail sales data, and study the state of the U.S. consumer.
What better time than this? To best assist any macro analyst, the U.S. Census produces the Advance Monthly Retail Trade Surveys (MARTS and MRTS), the Annual Retail Trade Survey (ARTS), and the Quarterly E-Commerce Report. Click that hotlink to access these surveys.
Together, these U.S. Census reports produce the most comprehensive data available on retail economic activity in the United States.
I. The Broad U.S. Retail Sales Scene: Long-term Trends Remain Intact
Just before this 2023 Xmas season began, the Oct. Census report began with:
“Advance estimates of U.S. retail and food services sales for October 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $705.0 billion, and up +2.5% above October 2022.”
In comparison to that +2.5% adjusted retail sales number? The U.S. real GDP Growth rate in the U.S economy in Nov. 2023 is tracking at +2.4%. Basically, matching its trend.
That $705B Oct. 2023 number can be put into a much longer context too. Consult a Fed of St. Louis (FRED) 30-year timeline, shown below. The blue line (below) is Advance Retail Trade and Food Services. The red line is just the Retail Trade numbers.
![St Louis Federal Reserve](https://staticx-tuner.zacks.com/images/articles/charts/03/57529.jpg?v=1666039189)
Image Source: St Louis Federal Reserve
You can see, quite easily: post-COVID U.S. macro retail spending has been robust.
There is a bit of a chart illusion in play, though. The annualized nominal retail spending trend is actually similar, when compared to the five years prior to COVID.
- For the 45 post-COVID months, I computed around +4.2% as an annualized U.S. Retail Sales gain.
- For the five years from Feb. 2015 to Feb 2020, I found a +4.1% annualized gain.
In the next chart, I show any budding retail spending analysts the Total Retail Trade Industries Producer Price Index against the CPI for All Urban Consumers.
![St Louis Federal Reserve](https://staticx-tuner.zacks.com/images/articles/charts/c7/57530.jpg?v=672628759)
Image Source: St Louis Federal Reserve
In terms of relative prices, there has been a net improvement seen for the U.S. Retail Trade environment, broadly.
In short, there has been a relative price improvement, assisting U.S. retailers.
- On Feb. 2020, the full pre-COVID retail trade number stood at $525.4. That made for a +34.3% Retail Trade and Food Services sales gain across the next 45 months of time.
- Across that identical 45-month period, the U.S. Consumer Price Index for All Urban Consumers went up +18.7%.
- That nets out to a +15.6% ‘real’ gain in underlying U.S. retail sales over those 45 months.
You may not be able to afford a very expensive home, or a very expensive car, with much higher interest rates on any loan. But you can still get out there, and eat and shop, at a much lower price point.
The next chart I show has Beer, Wine, and Liquor Stores and Restaurants and Other Eating Places.
![St Louis Federal Reserve](https://staticx-tuner.zacks.com/images/articles/charts/33/57531.jpg?v=891726495)
Image Source: St Louis Federal Reserve
Since the Restaurants data (above) ends well above the Beer, Wine and Liquor store data in 2023, you can infer this: Getting out on the town, with family and friends, has indeed been a major attraction, across the last year. Parties and gatherings got bigger, and happened more often.
Next, there is the need to update you on the E-Commerce Retail Sales data. In percentage terms, this stands at 15.6% of Total U.S. Retail Sales. Pre-Covid? In Q1-2020, I marked a 11.9% number.
In Q1-2015, I marked 6.9%. That is a 5.0% e-commerce gain, across 5 years of time. So, +1.0% in annual e-commerce retail penetration should be the underlying trend.
45 months of U.S. post-COVID retail sales time should have racked up 3.75% in added sales penetration. Here’s the math (11.9% plus +3.75% = 15.65%).
![St Louis Federal Reserve](https://staticx-tuner.zacks.com/images/articles/charts/5f/57532.jpg?v=30586422)
Image Source: St Louis Federal Reserve
That means actual e-commerce penetration (15.6%) is nearly identical to what any diligent analyst should have expected (15.65%).
So much for COVID having accelerated the e-commerce spending advance! That did not happen.
Image: Bigstock
A 2023 Christmas Holiday Season Shopping Report
This is an excerpt from our most recent Economic Outlook report. To access the full PDF, please click here.
We are midway thru the typically strong seasonal Christmas holiday shopping season.
Let’s tap the best U.S. retail sales data, and study the state of the U.S. consumer.
What better time than this? To best assist any macro analyst, the U.S. Census produces the Advance Monthly Retail Trade Surveys (MARTS and MRTS), the Annual Retail Trade Survey (ARTS), and the Quarterly E-Commerce Report. Click that hotlink to access these surveys.
Together, these U.S. Census reports produce the most comprehensive data available on retail economic activity in the United States.
I. The Broad U.S. Retail Sales Scene: Long-term Trends Remain Intact
Just before this 2023 Xmas season began, the Oct. Census report began with:
“Advance estimates of U.S. retail and food services sales for October 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $705.0 billion, and up +2.5% above October 2022.”
In comparison to that +2.5% adjusted retail sales number? The U.S. real GDP Growth rate in the U.S economy in Nov. 2023 is tracking at +2.4%. Basically, matching its trend.
That $705B Oct. 2023 number can be put into a much longer context too. Consult a Fed of St. Louis (FRED) 30-year timeline, shown below. The blue line (below) is Advance Retail Trade and Food Services. The red line is just the Retail Trade numbers.
Image Source: St Louis Federal Reserve
You can see, quite easily: post-COVID U.S. macro retail spending has been robust.
There is a bit of a chart illusion in play, though. The annualized nominal retail spending trend is actually similar, when compared to the five years prior to COVID.
In the next chart, I show any budding retail spending analysts the Total Retail Trade Industries Producer Price Index against the CPI for All Urban Consumers.
Image Source: St Louis Federal Reserve
In terms of relative prices, there has been a net improvement seen for the U.S. Retail Trade environment, broadly.
In short, there has been a relative price improvement, assisting U.S. retailers.
You may not be able to afford a very expensive home, or a very expensive car, with much higher interest rates on any loan. But you can still get out there, and eat and shop, at a much lower price point.
The next chart I show has Beer, Wine, and Liquor Stores and Restaurants and Other Eating Places.
Image Source: St Louis Federal Reserve
Since the Restaurants data (above) ends well above the Beer, Wine and Liquor store data in 2023, you can infer this: Getting out on the town, with family and friends, has indeed been a major attraction, across the last year. Parties and gatherings got bigger, and happened more often.
Next, there is the need to update you on the E-Commerce Retail Sales data. In percentage terms, this stands at 15.6% of Total U.S. Retail Sales. Pre-Covid? In Q1-2020, I marked a 11.9% number.
In Q1-2015, I marked 6.9%. That is a 5.0% e-commerce gain, across 5 years of time. So, +1.0% in annual e-commerce retail penetration should be the underlying trend.
45 months of U.S. post-COVID retail sales time should have racked up 3.75% in added sales penetration. Here’s the math (11.9% plus +3.75% = 15.65%).
Image Source: St Louis Federal Reserve
That means actual e-commerce penetration (15.6%) is nearly identical to what any diligent analyst should have expected (15.65%).
So much for COVID having accelerated the e-commerce spending advance! That did not happen.