Retail Sales Jump
It may have cost much more to fill up at the pump last month, but consumers were not letting that affect spending in other areas. According to the National Retail Federation (NRF), retail industry sales for August (which exclude automobiles, gas stations and restaurants) rose a strong 7.9 percent unadjusted over last year and increased 0.5 percent seasonally adjusted from July. The gains, compared to a relatively weak August last year, were stronger than NRF had been expecting.
“Though gas prices are a concern, the August report is further proof that it is unwise to base retail sales projections on one economic indicator,” said NRF chief economist Rosalind Wells. “Retailers who were anxious about the upcoming holiday season may be breathing a little easier.”
August sales numbers released recently by the U.S. Commerce Department show that total retail sales dipped 2.1 percent seasonally adjusted from July due to weak auto sales and increased 9.5 percent unadjusted year-over-year. Gasoline sales, which NRF does not include in its calculation of retail industry sales, rose 31.3 percent unadjusted from last August.
Though the U.S. Commerce Department could not specifically quantify the influence of Hurricane Katrina, it said the impact should have been minimal because the affected area accounted for slightly more than 1 percent of total retail sales. Also, because Hurricane Katrina hit at the end of the month, any impact in August was small, said NRF.
All retail industry sales categories saw substantial growth last month. The back-to-college season led to strong sales for furniture stores, which rose 0.9 percent adjusted from the previous month and climbed 7.9 percent over last year. Electronics and appliance sales were also strong last month, led by college student spending. Sales at those stores rose 0.3 percent adjusted from July and 7.1 percent unadjusted from last August. Sales were also very strong at health and personal care stores, which saw gains of 1.2 percent adjusted from July and 10.7 percent over last year. Building materials and garden equipment and supplies dealers continued to see strong year-over-year growth with sales climbing 0.5 percent adjusted from July and an impressive 11.4 percent over last August.
NRF estimates that combined back-to-school and back-to-college sales were $47.8 billion this year.