Unemployment rates are expected to decline while retail industry sales are projected to increase.
NORTH AMERICA–The National Retail Federation is projecting that U.S. retail sales (excluding automobiles, gas stations and restaurants) will increase between 3.8 and 4.4 percent over 2017.
Additionally, online and other non-store sales, which are included in the overall number, are expected to increase between 10 and 12 percent.
Retail sales grew 3.9 percent to $3.53 trillion in 2017 compared 2016, according to the U.S. Census bureau’s preliminary estimate for the year. The number is subject to revision, but exceeded NRF’s 2017 forecast for growth between 3.2 and 3.8 percent.
“A robust holiday season for retail sales is just one of many barometers that points to a consumer that is clearly feeling positive about their financial health,” says Matthew Shay, president and chief executive officer, NRF. “Despite headlines to the contrary, the retail industry is strong, growing and meeting consumer demand with the products they want at the prices they expect and the shopping experience they want to have, online or in store. With consumer confidence high, unemployment low and wages growing, there is every reason to believe that retail sales will be robust throughout the year.”
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Additional economic insights from the NRF projections include:
- The economy is expected to gain an average of 163,000 jobs a month, down slightly from 2017 but consistent with labor market growth.
- Unemployment is expected to drop more than 3 percent by the end of the year.
- Economic growth is likely to be in the range of 2.5 to 3 percent
“The underpinnings of the economy are very good and consumer spending is at the center of our outlook,” says Jack Kleinhenz, chief economist, NRF. “The push and pull of forces both external and internal to the U.S. economy will continue to provide challenges, but on balance we expect a good year. And as the retail industry continues to transform, retailers will leverage the new tax plan to invest in their employees, stores and new formats that engage with the ever-evolving and demanding consumer.”