Retail Sales Finish 2017 Strong; Positive Outlook for 2018

By at 12 January, 2018, 11:14 am

by Raymond J. Keating-

Retail sales finished 2017 on a strong note.

As reported by the U.S. Census Bureau, U.S. retail and food services sales for December 2017, adjusted for seasonal variation and holiday and trading-day differences, increased by 0.4 percent. That rounded out a solid four-month performance at the end of 2017.

See CNBC: Strongest Holiday Sales Since Great Recession, up 5.5% topping industry’s forecast

Consider that from February to August, retail sales numbers were less than impressive, with only two of those seven months showing real growth, three months experiencing declines and two months being effectively flat.

      Chad Moutray, Chief Economist of the National Association of Manufacturers                  (, graphs the performance of retail spending over the past year.

Subsequently, growth was exceptionally strong, with September coming in at +2.0 percent, October at +0.7 percent, November +0.9 percent, and December’s 0.4 percent. To put this in perspective, since 1992, the average monthly percent gain registered 0.4 percent.

Looking ahead, the clearest positives heading into 2018 come via the December passage and signing of the “Tax Cuts and Jobs Act,” as it boosts profitability and incentives for business investment, which is the source for productivity, income and employment growth, while also providing relief for most individual taxpayers.

Indeed, retailers should see some of the biggest benefits coming from the reduction in the corporate income tax rate from 35 percent to 21 percent. As stated by National Retail Federation President and CEO Matthew Shay:

“Retailers are winners under tax reform since our industry receives few of the tax breaks that benefit other sectors of the economy and pay the highest effective tax rate of any industry. Lower taxes will help us grow our businesses and offer our customers better value. But the biggest benefit for retailers will come as lower taxes and increased global competitiveness help U.S. companies throughout the economy put more Americans to work and pay them higher wages. Consumers with jobs and money in their pockets benefit the entire economy, including retailers and every job behind every product on our shelves.”

Indeed, this is all good news looking ahead – other things being equal – for the entrepreneurs, small businesses and workers that populate the retail sector.


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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