New York—Retail sales in May fell month-over-month as stimulus spending waned, but sales still grew by double digits compared with May 2020.
Overall, U.S. retail sales were down 1.3 percent month-over-month in May to $620.2 billion, according to data from the U.S. Department of Commerce, while year-over-year sales were up 28 percent.
Sales in April were up 0.9 percent month-over-month and up 53.4 percent year-over-year as per the revised figures.
Notably, fewer purchases of automobiles weighed down May retail sales as automakers face a global shortage of computer chips
, used to power screens and other features. If automobiles were excluded, retail sales would be down 0.7 percent for the month.
“While May retail sales were down slightly, largely due to supply chain constraints, the more accurate indicator remains in the year-over-year data which, as the NRF calculates, showed growth of over 17 percent,” said National Retail Federation President and CEO Matthew Shay in a press release about the results.
Retail sales are up 17.6 percent year-over-year for the first five months of 2021, noted Shay.
“While there are downside risks related to labor shortages, supply chain bottlenecks, tax increases and over-regulation, overall, households are healthier, and consumers are demonstrating their ability and willingness to spend. We are confident.”
The NRF recently upped its annual retail sales forecast for the year, encouraged by the vaccine rollout and the resiliency of consumer spending.
Retail sales (excluding automobiles, gas stations and restaurants) are now expected to grow between 10.5 and 13.5 percent year-over-year to more than $4.44 trillion.
“Month-over-month comparisons and percentages of change simply don’t tell the story,” said NRF Chief Economist Jack Kleinhenz, noting that spending has been high in recent months.
“Long-term trends in the number of dollars spent tell much more about the continuing economic recovery than whether sales were up or down from month to month.”
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The NRF also calculates retail sales, excluding auto sales, gas stations, and restaurants.
Its calculations show retail sales were the second highest on record in May, surpassed only by holiday spending in December.
“Demand has continued to be strong even as the concentrated impact from government stimulus has faded. There is still pent-up demand for retail goods and consumers are likely to remain on a growth path into the summer,” said Kleinhenz.
The NRF’s numbers show May sales were down 1.2 percent seasonally adjusted from April and up 17.3 percent unadjusted year-over-year.
May retail sales were down in two-thirds of retail categories on a monthly basis, but up across the board year-over-year, excluding grocery stores.
Notable increases were seen in clothing, electronics, and furniture stores, which were mostly closed last year.