Dive Brief:
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Retail sales (excluding autos) fell 0.3% in September, the biggest decline since January, according to monthly retail sales report from the U.S. Department of Commerce’s Census Bureau. Bloomberg economists had expected a decline of just 0.1%.
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E-commerce sales declined, as did sales at general-merchandise stores, home centers, grocery stores, electronics stores, and on appliances. Sales rose, as they have in previous months, at restaurants and clothing stores. Consumers are spending more on cars and at restaurants, according to the report. Sales fell at convenience stores and gas stations, in large part due to a fall in fuel prices; the Commerce Department doesn’t factor in price declines.
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Meanwhile, the September report from in-store analytics company RetailNext found that store traffic fell 8.1% year over year, the smallest decrease since January. Conversion fell 0.1% after monthly increases all year so far, with a sales decrease of 8.7%. Labor Day was strong, but hurricane weather in the Southeast dinged sales there, and nice weather elsewhere helped temper fall apparel sales.
Dive Insight:
September’s retail sales news are an indication of tempered consumer confidence ahead of the holidays. Employment, which has seen gains all year, is slowing and economists say even those gains haven’t translated to the wage gains that would support a bigger, more sustained boost in consumer spending.
“There might be a few chinks in the armor,” Millan Mulraine, TD Securities LLC deputy chief of research and strategy, told Bloomberg. “It would bring into question the resilience of the momentum we’ve seen in consumer spending.”
Other research has also shown a dip in consumer confidence, as global economic concerns, especially in Europe and China, and a stubborn wage gap offset other strong fundamentals in the U.S. economy.
