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April sales decline is double that of March

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WASHINGTON — Retail sales dropped almost twice as much during April as they did in March, reflecting the first full month when most stores were closed because of the coronavirus pandemic.

The U.S. Census Bureau reported that overall retail sales during April were down 16.4% seasonally adjusted from March and down 21.6% unadjusted year over year. That follows a record-setting 8.3% month-over-month drop in March.

“These retail sales numbers are not a surprise, given the current state of affairs,” National Retail Federation (NRF) president and chief executive officer Matthew Shay said. “The vast majority of retail stores have been closed, we are in the midst of historic unemployment and, when it comes to personal finances, discretionary spending takes a back seat to essentials. Prior to this pandemic, retail was setting records in year-over-year growth, employment and investment. It is a resilient industry serving a smart consumer and, despite today’s report, we know it will be leading our nation’s economic recovery as this crisis recedes.”

NRF chief economist Jack Kleinhenz said the next sales report will probably have better news.

“Now that we’re in mid-May, many businesses are already starting to reopen,” Kleinhenz said. “Relief payments and pent-up demand should provide some degree of post-shutdown rebound, but spending will be far from normal and may be choppy going forward.

“I’m still of the opinion that we went into this with the economy on a sound footing and that we will hopefully come out of it the same. But we’re going to need more data to tell us whether the underpinnings of the economy have been damaged and how badly. We need to carefully watch the data and learn to understand what it is telling us.”

Kleinhenz also cautioned that the reliability of April’s numbers could be questionable because many retailers whose businesses were closed were not in their offices to respond to the Census Bureau’s monthly survey of sales data. In addition, the unprecedented economic situation makes it difficult to seasonally adjust the data for the fluctuations in sales that normally come in predictable cycles throughout the year.

NRF’s calculation of retail sales — which excludes automobile dealers, gasoline stations and restaurants — showed that April was down 14.1% seasonally adjusted from March and down 8.7% unadjusted year over year. The NRF numbers show less of a decline than the Census Bureau’s figures because the categories excluded were among those most affected, as fewer people were driving and most restaurants were limited to take-out orders if not closed entirely.

But every category of retail except online was down on a monthly basis in April, including grocery stores and others that had seen a surge in March as consumers stocked up. Online, grocery stores and building materials were the only categories that saw year-over-year gains.


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