Retail Sales Dip As Consumers Shift Focus
June 16, 2021
Retail sales fell last month as consumers shifted away from purchases of big-ticket items to services and goods related to going out as businesses reopen.
Retail sales were down 1.3% for the month, according to Commerce Department, as consumers spent less on cars, furniture, appliances, and building materials, all of which consumers spent more on throughout the pandemic. Supply chain disruptions and higher material costs have also made such purchases more expensive, which may be putting off consumers.
Instead, Americans are spending more on services, which account for the bulk of economic activity but are largely excluded from retail sales reports. Spending at restaurants and bars, which are included in retail sales data, was up 1.8% last month, bringing sales above pre-pandemic levels.
Credit and debit card spending gives a clearer sense of how much consumers are spending on leisure activities. According to data from Earnest Research, in the four weeks ending June 2, spending at casinos was up 17% from the previous four-week period. Spending on theme parks and indoor entertainment centers like bowling alleys was up 9% and spending at gyms was up 4%.
Commerce Department data also showed online sales dropped for the month as shoppers returned to in-person shopping.