Retail Sales Show Real Strength in November

by Patrick Lunsford, CollectionIndustry.com

Looking for clarity on the direction of the U.S. economy? Then don’t look at recent economic numbers. The Commerce Department today released retail sales figures for November, and they showed a 1% increase in consumer spending for the month. It was the first gain in retail sales since July.

Most economists were shocked by the numbers. Economists surveyed by Marketwatch and Bloomberg had expected a 0.2% rise in total retail sales. One economist even called the numbers “inexplicable”, noting to Marketwatch that “that government data show a cumulative 3.1% rise in auto sales over the past three months, while the automakers report sales volumes are down 1.2%.”

For November, retail sales of automobiles increased 0.9%. Excluding the gain in car sales, retail sales increased 1.1%, marking the largest increase since January.

November’s numbers come on the heels of dismal figures for October, which saw a 0.1% drop in retail sales, even after an upward revision in the latest government release. Coupled with October’s massive drop in consumer credit, it is becoming increasingly difficult to get a handle on the true direction of the economy. One economist summed it up rather matter-of-factly in an email to Marketwatch: “Do not ever EVER count out the U.S. consumer."

One thing that is certain is electronic and appliance sales led the way for November’s retail gains. Those items saw a 4.6% increase in the month, coupled with a 1.8% increase in building and hardware sales. Despite the much-circulated story about housing cooling off, it appears that consumers are spending money on their homes.

Even food and drink got in on the action: sales at food and beverage stores were up 0.9%, while sales at restaurants and bars were up 0.7%.

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