PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Retails Sales Up in April: Good News for Small Business

By at 12 May, 2017, 10:49 am

 

by Raymond J. Keating-

First quarter economic growth was very disappointing at a woeful 0.7 percent. But crawl inside the data, and it gets a bit strange. Private investment has under-performed since before the Great Recession, but it showed some life in the first quarter. Meanwhile, it was consumer spending that slowed dramatically.

See SBE Council’s look at first quarter GDP.

On May 12, the Census Bureau released its first take on retail sales for the month of April. And there’s some good news here.

U.S. retail and food services sales for April 2017 were up 0.4 percent over March. That was the fastest growth in three months. Compared to a year earlier, sales were up 4.5 percent, and during the three-month February-April period, sales grew by 4.7 percent over the same period last year.

Of course, it’s all about sustainability. If April retail sales numbers point to faster growth in consumer spending in the second quarter, and if solid investment growth in the first quarter carries over, we could see a nice step up in real GDP growth in the second quarter. While that’s a lot of “ifs,” let’s hope we’re getting pointed in the right direction on economic growth.

Finally, it’s worth noting that stronger retail sales is significantly about small businesses.  The retail sector overwhelmingly is about small business. Among the massive number of employer retailers in the U.S., 91.1 percent have less than 20 workers, and 98.4 percent have fewer than 100 employees.

Make no mistake, a pick-up in retail sales is good news for small business. And what’s good for small business is good for the U.S. economy.

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Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council.

Keating’s latest book published by SBE Council is titled Unleashing Small Business Through IP: The Role of Intellectual Property in Driving Entrepreneurship, Innovation and Investment and it is available free on SBE Council’s website here.

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