Every month, the U.S. Department of Commerce, Census Bureau, releases its first calculation of the previous month’s retail sales. At Retail Dive, we report these figures by grouping the key segments that define “retail” in a way that we hope is most meaningful to the industry.
We use unadjusted, advance numbers and year-over-year comparisons, with the government’s most recent revisions to its year-ago estimates. And although we of course include e-commerce, captured in the federal report as “nonstore retailers,” readers will note that the government includes sales from businesses not generally thought of as “e-commerce.”
YoY sales performance by sector
Monthly retail sales
How key retail sales fared year over year
Total sales+6%Non-store+12%Clothing & accessories+3%General merchandise+2%Sporting goods, hobby, bookstores+1%Furniture & home-1%Electronics & applicances-12%
Retail Dive calculates “total retail sales” of core segments, as well as what the Commerce Department calls “Nonstore retailers.” That includes e-commerce, mail order and infomercials, but also revenue from subsectors not generally considered traditional retail, including vending machines, home delivery (including newspapers and home heating oil), door-to-door solicitation, in-home demonstrations and portable stalls like non-food street vendors. Year-over-year comparisons use the most recent revisions to estimates; year-to-date numbers use only advanced numbers. Data from U.S. Census Bureau, Advanced Monthly Retail Trade Survey
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2022 2021 2020
- October 2022Total monthly sales: $232.55B
People kept spending in October, even if they had to break out their credit cards or tap their savings. In the segments tracked by Retail Dive, retail sales rose 5.7% year over year, according to numbers released Wednesday by the U.S. Department of Commerce.
This shows a certain level of consumer resilience, and may reflect some easing of inflation as indicated last week by the U.S. government’s consumer price index for the last 12 months. But shoppers continue to get less for more money, with many increasingly turning to credit cards to fund their purchases, analysts said.
“Consumers continue to defy gravity as spending on retail increases apace. However, while the headline numbers tell a story, they do not reveal the general mood music in the consumer economy,” GlobalData Managing Director Neil Saunders said in emailed comments. “As much as a rise in sales is welcome news, much of it is being driven by inflation. Indeed, when adjusted for inflation, our analysis shows volume sales to be down by 0.4%, which is modestly worse than last month. As such, it is not so much that consumers are spending with abandon and joy, as it is a case of them having to dig deep to fund the things they need to buy.”
Credit card balances in the third quarter rose by $38 billion or 15%, the largest year-over-year increase in more than two decades, according to a report Tuesday from the Federal Reserve Bank of New York. In the aggregate, balances are $2.36 trillion higher than at the end of 2019, before the pandemic recession, per that report.
“A lot of this spending, especially among middle- and lower-income shoppers, is being funded by unsustainable sources, such as increased credit card debt and drawing down savings,” Saunders said. “Over the past month, among this group we have detected an uptick in financial worries and a consequent small deterioration in spending levels.”
Some segments fared especially poorly last month, with home goods sales down 0.6% and electronics sales plummeting 12.3% compared to October 2021.
“This suggests that people are cutting back on these larger, often discretionary, purchases,” Bankrate Senior Industry Analyst Ted Rossman said in emailed comments. “That’s likely because high inflation is leading them to spend more on essentials, and also because a lot of demand was pulled forward the past couple of years due to the pandemic. If you bought a new couch or TV or renovated your kitchen because you were spending more time at home in 2020 or 2021, you probably don’t need to do that again for a while.”
E-commerce – where growth has been slowing in recent months as shoppers returned to physical stores – posted a nearly 12% gain, in part thanks to early holiday sales held by Amazon, Target and others, analysts said. Apparel sales rose 2.5%, sporting goods sales edged up 0.6% and general merchandise sales rose 1.8%, per the Commerce report. Sales at department stores fell 1.7% from last year, however, which Rossman said reflects the excess inventory at those retailers.
“They’re having to offer more discounts to clear the backlog, and making matters worse, consumer demand for discretionary goods is falling,” he said.
That threatens to be the story for the holiday quarter at many retailers, according to Fitch Senior Director David Silverman.
“The holiday season, already well underway with the ‘official’ kickoff next week on Black Friday, will likely be characterized by greater markdown activity than last year despite these good trends, given many retailers were overly optimistic about 2022 trends and have excess inventory to clear over the next few months,” Silverman said in emailed comments.
- September 2022Total monthly sales: $218.44B
Despite stubbornly high prices and their late-pandemic preference for spending on dining out, travel and events, consumers continued to shop in September, pushing retail sales up 7.1% year over year among the segments followed by Retail Dive, according to U.S. Commerce Department numbers released Friday.
E-commerce and other non-store sales rose 11.5% compared to September last year, reflecting some early holiday spending, analysts said.
“Ongoing inflation still hasn’t materially slowed down consumer spending,” Fitch Senior Director David Silverman said in emailed comments. “This result implies flattish volume comping against very strong growth in 2021 and despite inflation concerns and spending shifts to services like travel and entertainment.”
That is, due to inflation, consumers continue to spend more but get less, according to Bankrate Senior Industry Analyst Ted Rossman. Among the best performers were apparel retailers, where sales rose 4.5%, though volumes were down even in that category, according to GlobalData research.
“To be fair, the decline in volumes is not severe but it is representative of an economy that is tightening and of a shopper that is becoming more discerning and cautious about what they buy,” GlobalData Managing Director Neil Saunders said in emailed comments.
Department stores, whose 1.9% rise “lagged inflation by a wide margin,” per Bankrate, didn’t benefit much from the strength in apparel.
“Excess inventory, tired in-store experiences and changing consumer preferences are all weighing on these sellers,” Bankrate’s Rossman said in emailed comments.
Electronics sales plummeted nearly 9%, and a tepid 1.5% rise in home goods sales reflects larger volume declines. Sporting goods retailers and general merchandise stores each saw sales rise 4.8%. The numbers show that inflation is taking a toll on the consumer just as the holidays approach, Saunders said.
“The thing about the numbers across almost all categories is that, while they look OK on the surface, there are various underlying trends that suggest something less favorable is occurring,” he said. “This also applies to the overall headline figure, which is now being held up by a combination of whittling down savings, taking on more credit card debt, and more affluent consumers reluctantly absorbing the cost increases. Few of these things are truly sustainable over the longer term.”
- August 2022Total monthly sales: $231.31B
For the segments followed by Retail Dive, August retail sales rose 6.9% year over year, according to numbers released Thursday by the U.S. Department of Commerce, as e-commerce rose 12.3%.
The result may be as good as could be expected, given that inflation has remained stubbornly high at 8.3%, according to government data released earlier this week.
“Retailers would probably like to be growing more, especially relative to inflation, but I’m not sure they could realistically hope for much more,” Bankrate Senior Industry Analyst Ted Rossman said in emailed comments. “Consumer spending habits are changing as the pandemic continues to recede and inflation remains high. Even if growth is a bit slower, it’s still growth.”
Home goods and furniture sales rose less than 1% year over year and electronics sales fell 5.2%, while apparel sales rose 3.7%, department store sales rose 1.2%, general store sales rose 3.2% and sporting goods sales rose 7.1%, according to the Commerce Department report.
While year over year, most segments eked out sales increases, inflation likely masked some volume declines, as in apparel, though GlobalData recorded volume growth across several categories reflecting the “best pace of expansion since the start of the year,” according to a Thursday research note.
The back-to-school season helped retailers in August, though volumes were muted, and the discounts that many retailers resorted to last month in order to clear inventories were a draw for consumers, according to GlobalData Managing Director Neil Saunders.
“Overall, the solid August numbers will provide some confidence as we move into the golden quarter,” he said. “This may not be a stellar holiday season, but neither is it likely to be a complete bust.”
- July 2022Total monthly sales: $224.77B
For the cohort of retail segments followed by Retail Dive, which don’t include auto sales, grocery or fuel, retail sales in July rose 0.8% compared to June and 9.6% compared to 2021, according to numbers released Wednesday by the U.S. Commerce Department. The result reflects the ongoing impact of inflation -- as the numbers aren’t adjusted for higher prices -- but also falling gas prices and some resilience among consumers, analysts say.
Robert Frick, corporate economist with Navy Federal Credit Union, noted that this portion of retail sales notched a “decent gain.”
“That retail sales held steady in July shows consumers haven’t buckled to high inflation,” he said in emailed comments. “Spending patterns have changed to more staples as gas and food prices have risen, but Americans generally continue to eat out, travel and spend to maintain their standards of living.”
E-commerce delivered in July, rising 29.6% year over year, which several analysts attributed to Prime Day – a midsummer sale that is no longer just an Amazon-only event. Other segments fell sharply or eked out minimal growth that was largely or totally wiped out by inflation.
Electronics sales fared worst, falling 11.9% year over year, followed by department store sales, which tumbled 8.7%. Apparel sales dropped 2.3%, home goods and furniture sales plus general stores each dropped 3.3%. Sporting goods sales edged up 0.4%.
Inflation remains a major reason for July’s retail sales increase, and excess inventory levels are likely to continue wreaking havoc on retailers’ quarterly earnings reports despite revenue growth, according to Fitch Senior Director David Silverman. Nevertheless “the results argue against a broad-based consumer slowdown,” Silverman said in emailed comments.
That volatility and shifts in consumer behavior are poised to continue as retailers prepare for the holidays – what for most is their most important selling season.
“Retail sales are holding their own right now,” Bankrate Senior Industry Analyst Ted Rossman said in emailed comments. “That’s actually a pretty good sign for consumers and the economy, all things considered. The biggest questions moving forward are how long inflation will remain high, and how much consumers will change their behavior as a result.”
- June 2022Total monthly sales: $223.07B
Retail sales in June rose 7.7% year over year among the segments tracked by Retail Dive, according to monthly numbers released Friday by the U.S. Commerce Department. The growth is not adjusted for the record inflation also reported this week, however. And sales in some segments declined as household budgets went toward filling up gas tanks and other essential items.
“[T]his feels like an inflation story to me,” Bankrate.com Senior Industry Analyst Ted Rossman said in emailed comments, noting the government this week clocked a 9.1% year-over-year rise in consumer prices, the highest in four decades. “Adjusted for inflation, retail sales actually fell over the past year.”
E-commerce sales were a standout, climbing 2.7% month over month and 20.6% year over year, which Wells Fargo economists Tim Quinlan and Shannon Seery said reflects a consumer strategy to save on gas.
Electronics sales took the biggest tumble, down 9.8% from last year, an indication that consumers are avoiding bigger-ticket purchases, according to Rossman. Apparel sales fell 2.5%, department store sales fell 4.9%, sporting goods sales fell 0.3% and general merchandise sales fell 0.6%. At apparel retailers, “in volume terms, sales were strongly negative,” GlobalData Managing Director Neil Saunders said in emailed comments.
Uncertainty for retail prevails for the time being as the inflation story unfolds.
The June retail sales report “could be a lot worse, but it indicates that consumer spending has grown less robust, a rational response given the many economic concerns that Americans are currently facing,” Bankrate’s Rossman said.
- May 2022Total monthly sales: $224.00B
In May, retail sales in the segment followed by Retail Dive rose 7.2% year over year and 31% compared to 2019, according to numbers released Wednesday by the U.S. Commerce Department. With May’s inflation rate reaching 8.6%, however, retail sales were closer to flat compared to last year.
Still, that indicates a fairly steady consumer so far this year, analysts said. Many households tapped their savings and turned to credit cards in the period, according to Wells Fargo Economists Tim Quinlan and Shannon Seery. Non-revolving consumer credit posted its largest monthly increases on record in the past two months, they noted in emailed comments Wednesday.
“Despite the highest inflation in 40+ years, consumers have demonstrated uncanny staying power thus far in 2022,” they also said, but warned that “the factors that have sustained spending thus far are getting near the end of their rope, and we are increasingly concerned that goods spending will slow sharply and that will be particularly evident in retail sales which is mostly a measure of goods spending.”
Inflation has had some impact on nearly all consumers, and that’s especially profound for households that were already struggling, according to research from Numerator. Shoppers are searching out coupons and promotions (50%) and stocking up on sale items (51%), with 66% of struggling households cutting back on nonessential spending, per that report.
“Our data now show a clear pattern of more consumers taking evasive action to reduce their food bills by visiting cheaper stores more often, trading down to lower cost brands, and buying into more bargains and offers,” GlobalData Managing Director Neil Saunders said in emailed comments. “These indicators show that many households are under financial pressure.”
This hit to demand at the same time that gas and food prices are rising “will unravel many business models, especially on the top-line,” he also said.
Despite the pullback on discretionary spending, many consumers continued to refresh their closets. But inflation takes credit for much of apparel’s 3.5% rise year over year, and sales of home goods, electronics, sporting goods and department stores were significantly weaker or down, even before accounting for inflation.
“Overall, the results from May do nothing to change our view that while retail growth is moderating it is witnessing a relatively soft landing on the sales front,” Saunders said. “There is no abrupt curtailment of spending and while there [are] most certainly shifts in how and what people buy, these are relatively subtle and are somewhat masked by inflation. That does not mean retailers can relax completely.”
- April 2022Total monthly sales: $225.53B
The pandemic is still a challenge to human health, inflation is hitting household budgets and supply chains remain roiled, yet consumers are returning to a semblance of normal spending behavior. Retail sales in the segments followed by Retail Dive rose 11.3% year over year in April, as e-commerce sales rose 24.1%, according to numbers released Tuesday by the U.S. Department of Commerce.
“It is inevitable that when prices grow faster than wages, at some point difficult choices will have to be made...but not today,” Wells Fargo Economists Tim Quinlan and Shannon Seery wrote in emailed comments Tuesday.
Not all sectors fared well. Furniture and home goods, which flourished during the height of the pandemic, dropped 0.5%; sporting goods sales fell 5.5% and electronics sales fell 4.1%, according to the report. But apparel was in demand, as sales rose 8.9% and department store sales rose 7.8%.
The recovery against pandemic-dominated 2020 was stark, as overall retail sales jumped 57.8% and e-commerce rose 39.9%, with all sectors posting gains. Home goods sales rose 212.1%; electronics sales rose 116.9%; sporting goods sales rose 151.9%; and apparel sales rose a whopping 784.8%. Even department stores fared well compared to two years ago, with sales up 86.4%.
But retailers did well even compared to pre-pandemic 2019, as sales rose 40.5% and e-commerce rose 76%. Home, apparel and sporting goods all saw double-digit growth compared to three years ago.
“Such dramatic uplifts underline the fact that the pandemic-boom has not yet ended, even if its impact is fading,” GlobalData Managing Director Neil Saunders said in emailed comments.
Sales also benefited from late Easter and Passover and from tax refunds, many of which are also late but larger than usual, according to NRF Chief Economist Jack Kleinhenz. Job and wage gains are also helping offset inflation, he said.
Supply chain issues and a “winding-down of pandemic-demand” explain the slowdown in electronics and home, at least in part, Saunders said. There are some signs of caution among consumers, however, even in the segments with elevated sales. And some retailers will face a margin and profit squeeze in coming months, as they balance lower volumes with higher costs, he said.
Indeed, inflation and supply chain issues appear to be taking a toll on consumer confidence. On Friday the University of Michigan found consumer sentiment to be at its lowest point since 2013, and the multiple pressures on consumers are intensifying, according to Wells Fargo’s economics team.
“Inflation has been a worsening nuisance for the better part of the past year, but there is something about mortgage rates over 5% and gasoline over $4/gallon that really focuses the attention of consumers,” Wells Fargo economists said. “It’s one thing when you have to wait for a new appliance, and even though the causes might be the same, it is an altogether different kind of supply chain problem when you cannot get formula for your newborn. …[C]onsumers are feeling awful.”
This means that retail is entering a more difficult period, Saunders said. “However, we are also of the opinion that the landing looks to be a relatively soft one, at least in demand terms.”
- March 2022Total monthly sales: $217.81B
Consumers in March pulled back on their acquisition of goods, as they sent more dollars toward experiences like dining out and inflated prices on food and fuel. Last month, in the cohort of segments tracked by Retail Dive, retail sales rose 2.9% year over year, the slowest growth in nearly two years, according to GlobalData research.
“Retail purchases have been expected to drop as the services economy comes out of the COVID shadow, and consumers switch from more spending on goods to more spending on services,” Robert Frick, corporate economist with Navy Federal Credit Union, said in emailed comments. “But retail purchases are still above the pre-COVID trend, even excluding gasoline. Overall, despite the shock of higher gas prices and high inflation overall, consumers are more than holding their own.”
While positive, the year-over-year uptick was meager compared to last year: March retail sales in the group rose 28.5% in 2021. Last month, e-commerce growth was especially soft, rising 2.6% year over year, the weakest gain in more than three years, according to GlobalData.
The switch to higher spending on services (and on categories like fuel affected by inflation) siphoned spending on goods — and looks to be creating winners and losers in retail, according to GlobalData Managing Director Neil Saunders. The big boom in home goods (up 4.2% year over year), apparel sales (up 7.5%) and at department stores (up 3.3%), slowed somewhat in March, while electronics sales dropped 9.6% and sporting goods sales dropped 5.7%.
Still, consumers demonstrated resilience in March, a good sign given that inflation may be moderating, according to Wells Fargo Economists Tim Quinlan and Shannon Seery. “Inflation is not going away, but it will likely stop getting worse and that means less of a headwind for spending,” they wrote in an April 14 research note.
But spending on what? This year, retailers may come to look fondly on the last couple of years, when consumers were well supported by the federal government, and less able or less inclined to travel or dine out.
“Looking ahead, there is no need to be overly gloomy about retail,” Saunders said. “However, it is now very clear that 2022 will be a much tougher year. Ironically, while the pandemic years delivered a boom in spending, the post-pandemic period will be much more frugal.”
- February 2022Total monthly sales: $191.41B
Thanks to the availability of vaccines, ability to shop in stores, wage growth and in some cases healthy savings, consumers by and large brushed aside inflation concerns in February. The retail segments tracked by Retail Dive saw sales spike 14.3% year over year last month, with apparel sales soaring 31% and even department stores up 22.4%, according to numbers released Wednesday by the U.S. Commerce Department. Advancement from before the pandemic slammed retail was also robust, up 22.5% compared to February 2020 and a whopping 31.9% from 2019.
“Continued interest in fashions for socializing, vacations, and refreshing closets is still in play and is fueling consumer activity,” GlobalData Managing Director Neil Saunders said in emailed comments. “However, we have also detected some trading down with more shoppers turning to off-price, resale and value players for some of their purchases. This is likely in response to squeezed budgets.”
Higher prices helped push home goods sales up 7.4%, but GlobalData found that consumers also picked up the pace again on home-based projects after the holidays.
As Saunders and other analysts noted, price hikes did cast a shadow over the results, as the Census Bureau’s retail sales numbers aren’t adjusted for inflation. Still, nonessential retail prices have remained fairly steady, with food and fuel driving the biggest household expense increases: Core retail prices last month rose 0.4%, compared to the overall 1.3% rise, according to research from Wells Fargo economists.
The situation is likely to pinch the industry more in coming months if rising prices on staples continue to encroach on discretionary spending, however, several analysts warned. While shoppers were out spending, including at restaurants, inflation and Russia’s war on Ukraine are already shaking consumer confidence, analysts said.
“Consumers remain well supported by tight labor market conditions, strong wage gains, and excess savings accumulated over the past few years,” Plante Moran Financial Advisors Chief Investment Officer Jim Baird said in emailed comments. “Unfortunately, those dollars just aren’t going as far as anyone would like, as surging prices weigh on consumer sentiment and take a bite out of real growth.”
- January 2022Total monthly sales: $192.95B
January retail sales in the group followed by Retail Dive rose 6.4% year over year, a considerable slowdown from last year’s 13% rise, according to numbers from the U.S. Commerce Department released Wednesday. Notably, non-store sales (mostly e-commerce) rose 4.1%, compared to their 26% year-over-year increase in 2021, with GlobalData analysts finding that e-commerce penetration fell to 14.7% of retail, after two months above 16%.
GlobalData also estimates that inflation contributed 6.9 percentage points of January’s overall retail sales. Retailers’ prospects could dim this year if households begin to feel price hikes more acutely, according to GlobalData Managing Director Neil Saunders. “Although some lower income cohorts are now having to make tough choices about what to buy, many others are not yet at the point of radically changing their spending patterns,” he said in emailed comments. “Unfortunately, if inflation persists and interest rates rise, we believe this reality will start to bite later in 2022. In this sense, retail is probably currently living on borrowed time.”
Indeed, year-over-year January retail sales numbers from Affinity Solutions suggest that spending among lower-income consumers was down significantly year over year, while spending among wealthier consumers is rising — a reversal of behavior seen earlier in the pandemic and a glaring sign that the country’s wealth gap persists, according to Affinity CEO Jonathan Silver.
Real disposable income is down in part because the government is not supporting consumers as much this year, although many have built up their savings over the past two years and, for now, are in decent financial shape, according to research from Wells Fargo economists. To the extent that consumers do hang on to their spending power, more dollars are likely to go to services as the year goes on, Wells Fargo economists Tim Quinlan and Shannon Seery said.
Category-based spending patterns are also shifting somewhat. Along with the pullback in online sales, home goods sales rose just 5.8% year over year, compared with their 9.8% rise a year ago. But apparel’s comeback continues, with clothing sales up 24.3% and department store sales up 14.1%, both improvements over what those segments posted a year ago.