Monthly sales mixed for NAICS 444

The NRF maintains optimism for a record year for retail.

Sales at U.S. retail and food services declined 1.1% (adjusted) in July, about the same downward trend as building material and garden equipment and supplies dealers.

That’s the big picture from the July Advance Monthly Sales report from the U.S. Census, released Tuesday morning. The unadjusted numbers show July sales for NAICS 444 at $41.5 billion, compared to $45.54 billion in the prior month, but up from $39.4 billion in the same month last year.

Hardware stores (NAICS 44413), though not included in the Advanced report, have been updated through June. The latest tally of $3.23 billion, is down from the prior month ($3.27 billion) and also down from the prior year ($3.35 billion)

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At the National Retail Federation, optimism persists despite the delta variant and supply-chain disruptions.

“July retail sales showed slight deceleration in spending, but nothing to derail our outlook for a record year,” NRF President and CEO Matthew Shay said. “Though the delta variant is presenting health challenges while supply chain disruptions along with unfilled job openings are presenting business challenges, the consumer and broader economy continue to display steady strength aided by advanced tax credit payments and strong gains in the labor market and personal incomes.

Shay said the NRF encourages people to “get vaccinated as soon as possible to stop the spread of the virus and to keep our economy growing.”  

Building materials and garden supply stores were down 1.2 percent month-over-month seasonally adjusted but up 5.3 percent unadjusted year-over-year.

Other sectors of retail were mixed:

• Clothing and clothing accessory stores were down 2.6 percent month-over-month seasonally adjusted but up 45.8 percent unadjusted year-over-year.

• Electronics and appliance stores were up 0.3 percent month-over-month seasonally adjusted and up 23.4 percent unadjusted year-over-year.

• Furniture and home furnishings stores were down 0.6 percent month-over-month seasonally adjusted but up 15.6 percent unadjusted year-over-year.

• Sporting goods stores were down 1.9 percent month-over-month seasonally adjusted but up 14.5 percent unadjusted year-over-year.

• General merchandise stores were down 0.1 percent month-over-month seasonally adjusted but up 12.4 percent unadjusted year-over-year.

• Health and personal care stores were up 0.1 percent month-over-month seasonally adjusted and up 8.4 percent unadjusted year-over-year.

• Online and other non-store sales were down 3.1 percent month-over-month seasonally adjusted but up 3.7 percent unadjusted year-over-year.

• Grocery and beverage stores were down 0.7 percent month-over-month seasonally adjusted but up 2.9 percent unadjusted year-over-year.

NRF Chief Economist Jack Kleinhenz said. “The consumer has continued to be resilient and recent price increases brought on by constraints in the supply chain have not dampened the robust demand seen during the past year. 

The shift to spending on services was expected as more of the economy reopened, and this year’s move of the Amazon Prime Day promotion to June may have siphoned off some sales that normally come in July. But Kleinhenz said consumer finances are in good shape with a cushion from paying off debt and building up savings. Employment and wages have seen recent back-to-back increases, and advance child tax credit payments going out for the second month in a row should provide a bump for spending. Solid back-to-school spending contributed to July’s results and is expected to spill over into August as well.

For the first seven months of the year, sales as calculated by NRF were up 15.5 percent over the same period in 2020. That is consistent with NRF’s revised forecast that 2021 retail sales should grow between 10.5 and 13.5 percent over 2020 to between $4.44 trillion and $4.56 trillion.

NAiCS 444 retailers and dealers were up more than 5% compared to a year ago.