November Retail Sales Put Holiday Season on Track to Set New Records
Retail sales continued to grow in November, putting the 2021 holiday season on the home stretch for record spending despite inflation, supply chain disruptions and COVID-19, the National Retail Federation recently reported.
“Despite economic headwinds, November retail sales data confirms that consumers continue to spend, as demonstrated by a 14 percent increase in sales year-over-year,” NRF President and CEO Matthew Shay said. “We expect demand will remain strong through December, even though consumers started holiday shopping earlier than ever this year. Despite the rise of the omicron variant, increased vaccination rates combined with retailers’ ongoing safety protocols and procedures have resulted in consumers who feel they can continue to shop safely and conveniently. We believe that holiday sales this year could grow as much as 11.5 percent over 2020.”
“Consumers continued spending in November, building on momentum from strong early holiday shopping in October and setting the stage for a bright holiday season,” NRF Chief Economist Jack Kleinhenz said. “Consumers’ financial condition remains healthy and neither stubborn inflation nor COVID-19 appear to have derailed holiday spending despite both being top of mind. Recent labor market progress has helped propel incredibly strong demand, and most shoppers have the income and savings to absorb higher prices driven by the pandemic and supply chain disruptions. While seasonally adjusted numbers may make the results look modest, seasonal patterns have been significantly disrupted by the pandemic and unadjusted data shows November’s sales as calculated by NRF were actually the highest on record.”
The U.S. Census Bureau recently announced overall retail sales in November were up 0.3 percent seasonally adjusted from October and up 18.2 percent year-over-year. That compares with increases of 1.8 percent month-over-month and 16.3 percent year-over-year in October. Despite occasional month-over-month declines, sales have grown year-over-year every month since June 2020, according to Census data.
NRF’s calculation of retail sales – which excludes automobile dealers, gasoline stations and restaurants to focus on core retail – showed November was unchanged from October but up 14.8 percent unadjusted year-over-year. That compares with increases of 1.8 percent month-over-month and 10.6 percent year-over-year in October. NRF’s numbers were up 12.1 percent unadjusted year-over-year on a three-month moving average.
Consumers have shopped earlier than ever this year, but NRF defines the holiday season as November 1 through December 31, so the November results mark the completion of the first half of the official season. NRF currently expects that 2021 holiday sales during the two months could grow as much as 11.5 percent over 2020, exceeding NRF’s earlier forecast of between 8.5 percent and 10.5 percent growth. Even at the low end of the range, both the amount spent and the growth rate would set new records.
For the first 11 months of the year, sales as calculated by NRF were up 14.2 percent over the same period in 2020. That is consistent with NRF’s forecast that retail sales for the full year should grow between 10.5 and 13.5 percent over 2020 to between $4.44 trillion and $4.56 trillion.
November sales were up in all but three categories on a monthly basis and were up across the board year-over-year, led by increases at clothing, sporting goods and furniture stores. Specifics from key sectors include:
- Building materials and garden supply stores were up 0.7 percent month-over-month seasonally adjusted and up 12.2 percent unadjusted year-over-year.
- Furniture and home furnishings stores were unchanged month-over-month seasonally adjusted but up 18.6 percent unadjusted year-over-year.
- Electronics and appliance stores were down 4.6 percent month-over-month seasonally adjusted but up 17.7 percent unadjusted year-over-year.
- Online and other non-store sales were unchanged month-over-month seasonally adjusted but up 15.1 percent unadjusted year-over-year.
- General merchandise stores were down 1.2 percent month-over-month seasonally adjusted but up 14.2 percent unadjusted year-over-year.
- Health and personal care stores were down 0.6 percent month-over-month seasonally adjusted but up 9.1 percent unadjusted year-over-year.
- Grocery and beverage stores were up 1.3 percent month-over-month seasonally adjusted and up 8.8 percent unadjusted year-over-year.