PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

August Retail Sales Report: A Disappointment

By at 15 September, 2017, 10:57 am

 

by Raymond J. Keating-

The August retail sales report from the U.S. Census Bureau was a disappointment.

Not only did retail sales decline by 0.2 percent in August, but July’s positive growth rate was revised down from 0.6 percent to 0.3 percent, and June’s went from a gain of 0.3 percent to a tiny decline. That followed on effectively no growth in May.

Auto and related sales took a big hit in August, falling by 1.6 percent, after being flat in July. So, retail sales ex auto grew slightly, by 0.2 percent, but down from a 0.4 percent gain in July.

Overall, five of 13 major retail categories experienced declines in August.

The Census Bureau was unclear as to how Hurricane Harvey might have played into these numbers, but the impact obviously was negative, as will be Irma’s effect on September’s numbers.

This retail sales report, including factoring in the downward revisions, points to a very different story than the one told last month. As the numbers have been revised, what has emerged is retail sales this year being sluggish since January (see accompanying chart above).

Even when putting aside the tragic consequences of Hurricanes Harvey and Irma, questions persist about economic growth in the U.S., and that is reflected in retail sales data going back to the start of this year.

The story remains that the U.S. economy is in need of major relief from and reform of governmental policies in the areas of taxes, regulation, ObamaCare and so on. That, in turn, will incentivize risk taking, and forming a key for unlocking accelerated economic growth.

_______

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.

News and Media Releases