PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Economic Update: Solid Growth in Retail Sales

By at 14 June, 2018, 10:13 am

by Raymond J. Keating-

The Census Bureau’s report on May retail sales ranks as another positive piece of data on the U.S. economy.

Retail sales were largely expected to increase by 0.4 percent in May, but growth came in at double that rate, registering 0.8 percent. (And even after factoring out gasoline purchases, retail sales increased by 0.7 percent.)

It’s also worth noting that 0.8 percent growth is double the average monthly growth rate looking at data back to 1992.

Over the past year, total retail sales were up 5.9 percent, and 6.4 percent excluding autos, 4.9 percent excluding gasoline, and 5.1 percent excluding both autos and gas.

This is good news for overall economic growth in the second quarter, particularly given the fact that personal consumption expenditures grew at a mere 1 percent in the first quarter, while gross private domestic investment expanded by 7.2 percent. It was the consumption factor that restrained growth in the first quarter.

Therefore, a combination of continued strong business investment and stepped up consumer activity would indicate strong second quarter economic growth.

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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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