U.S. retail sales fell for the third consecutive month in December when the coronavirus pandemic led buyers to cut pennies and cut back at home.
Retailers and food retailers made just under $ 541 billion last month – the lowest level since July – after declining 1.4 percent in November and 0.1 percent in October, the U.S. Census Bureau said Friday.
December’s larger-than-expected decline of 0.7 percent comes amid an increase in COVID-19 infections and deaths that put retailers under pressure during the holiday season. According to Wrightson, ICAP economists expected sales to remain flat last month.
“The COVID-19 closures have sent consumers to their homes where they are too worried about the prospect of spending a dime at stores and malls across the country,” said Chris Rupkey, chief financial officer of MUFG Union Bank, said.
Retail spending in December was 2.9 percent higher than the previous year, but about 2.1 percent lower than the peak of about $ 553 billion in 2020 reached in September.
The slowdown came despite an unexpectedly strong holiday season in which retailers posted $ 789.4 billion in sales, a jump of 8.3 percent from 2019, according to the National Retail Federation.
While consumers spent more on cars, clothing and personal care products in December, online and other non-store sales fell 5.8 percent, and electronics and appliance retailers overtook 4.9 percent less, the persons said.
According to Jonathan Silver, CEO of Affinity Solutions, a global restaurant, a 4.5 percent drop fell while sales in food and beverage stores fell 1.4 percent – a possible sign of food insecurity among Americans who recovered during the pandemic. insights and marketing solutions firm.
“One of the biggest takeaways from the current numbers is that the lower-income groups that kept the economy going until the fall began to show spending, most likely related to stopped stimulus and potential problems with unemployment,” Silver said.
The December downturn came as the U.S. economy shook off jobs for the first time since April when officials introduced a new round of lock-in measures to curb the spread of COVID-19.
While the vaccines being rolled out nationwide could help retailers recover in the coming months, ‘the pandemic has certainly changed the way we shop, so even when store windows reopen, e-commerce will still be a vital resource of income. for retailers, ”says Marwan Forzley, CEO of payment technology firm Veem.