PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

ECONOMIC NEWS: Retail Sales Up in June

By at 16 July, 2021, 1:44 pm

by Raymond J. Keating –

The U.S. Census Bureau reported that retail sales bounced back in June after a decline in May. June retail and food services sales increased by 0.6 percent.

And compared to a year earlier, retail sales were up a robust 18.0 percent. And versus pre-pandemic February 2020, June 2021 sales were up by 18.2 percent.

Source: Federal Reserve Bank of St. Louis, FRED

Retail sales have experienced one of the strongest recoveries from the pandemic among major economic indicators.

However, questions swirl around the effects of government aid and, therefore, sustainability. SBE Council has noted that three rounds of government aid payments – starting in March 2020, in December 2020 and in March 2021 – have had temporary effects on retail sales. For good measure, federal unemployment benefits are scheduled to run to September 6 in about half the states.

Indeed, it will not be until at least the fall of this year – when the economy has climbed back to where it was pre-pandemic, and government aid has run its course – that we will start to get a better read on the actual state of the economy.

For now, it is critical to keep in mind that consumers, in normal economic times, take their cues from what’s happening in terms of business growth and hiring. That means it will be vital to avoid hoisting additional tax and regulatory burdens on entrepreneurs, businesses and investors.

Unfortunately, the Biden administration and the majority in Congress seem intent on taking policy down an anti-growth path.

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

 

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