Sobering Report: The Slide in January Retail Sales

By at 15 February, 2024, 4:49 pm

by Raymond J. Keating –

The latest retail sales report from the U.S. Census Bureau was sobering.

Retail and food services sales (seasonally adjusted) for January 2024 declined by 0.8 percent compared to December. For good measure, December sales were revised down from +0.6 percent to +0.4 percent.

Compared to a year earlier, retail and food services sales were up by only 0.6 percent.

Source: Federal Reserve Bank of St. Louis, FRED

But if we look at the most recent three-month period, so as to avoid any one-month outliers (which January 2023 arguably was, as noted in the above chart), sales during the period of November 2023 to January 2024 increased by 3.1 percent versus the November 2022 to January 2023 period. And while gasoline stations suffered a big decline here, many other categories experienced fairly solid growth.

However, as noted in the above chart, retail sales have been negative in three of the last four months. This is the most troubling part of this report.

In addition, these numbers are in nominal dollars, that is, not adjusted for inflation. Factor inflation in, and the recent story on retail sales gets even worse.

As I’ve noted before, during an under-performing economy, we often get mixed and sometimes conflicting data. Put the latest retail sales numbers in the “Growing Concerns on the Economy” column.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. His latest books on the economy are The Weekly Economist: 52 Quick Reads to Help You Think Like an Economist, The Weekly Economist II: 52 More Quick Reads to Help You Think Like an Economist and The Weekly Economist III: Another 52 Quick Reads to Help You Think Like an Economist.


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