US retail sales rebounded with huge gains in March after new government stimulus cheques and increased vaccination against Covid-19 encouraged shoppers to get out and spend – all of which helped to boost demand for clothing.
Apparel retailers saw sales rise 18.3% month-on-month in March, according to data released by the US Census Bureau. Sales soared by 101.1% compared to the same period a year ago when retailers across the US began to shutter stores in an attempt to stem the spread of coronavirus.
Overall retail sales during March were up 9.8% seasonally adjusted from February and up 27.7% year-on-year. That compares with a monthly decrease of 2.7% and a yearly gain of 6.7% in February. Despite occasional month-over-month declines, sales have grown year-over-year every month since June 2020, according to Census data.
Ken Perkins, president of research firm Retail Metrics, says consumers “blew away” the Street’s estimates of a 6.1% month-on-month increase, as stimulus cheques layered on top of an already high savings rate meant shoppers were flush with cash.
“Our store checks throughout the month found increasing traffic at major big-box chains like Target, Best Buy, Lowe’s, Home Depot, Dick’s Sporting Goods, with more modest traffic gains at mall-based apparel retailers such as American Eagle, Urban Outfitters, Holllister (ANF), and Old Navy (GPS).”
National Retail Federation (NRF) chief economist, Jack Kleinhenz, adds: “After a disappointing February, there was a perfect alignment of factors supporting a surge in shopping in March. Further reopening of the economy was encouraged by economic stimulus payments, the public health situation improved with more vaccinations, employment grew and there was seasonal activity around Passover, Easter, and spring break. Even with some stimulus money going to savings, consumers’ finances are healthy, and they are willing to spend. Retail sales supported by rigorous fiscal and monetary policy continue to be a bright spot in the economy and have provided momentum during this awful pandemic.”
NRF’s calculation of retail sales – which excludes automobile dealers, gasoline stations and restaurants to focus on core retail – showed March was up 7.4% seasonally adjusted from February and up 17.7% unadjusted year-over-year. That compared with a month-over-month decrease of 3.4% and an increase of 7.2% year-over-year in February.
NRF’s numbers were up 12.7% unadjusted year-over-year on a three-month moving average.
March retail sales increased across the board on a month-over-month basis and in every category except grocery on a year-over-year basis. The year-over-year comparisons were dramatic in some categories – clothing store sales more than doubled – but were skewed because most stores were ordered closed in mid-March last year because of the pandemic.
Clothing and clothing accessory stores were up 18.3% month-over-month seasonally adjusted and up 104.6% unadjusted year-over-year.
Sporting goods stores increased 23.5% month-over-month seasonally adjusted and up 78.2% unadjusted year-over-year.
Meanwhile, online and other non-store sales rose 6% month-over-month seasonally adjusted and by 30.7% unadjusted year-over-year.