Holiday Retail Sales Had a Lackluster November Start -- Update
December 13 2019 - 10:30AM
Dow Jones News
By Harriet Torry
WASHINGTON -- Retail sales advanced at a lackluster pace in
November, signaling a slower-than-expected start to the critical
holiday shopping season.
Retail sales, a measure of consumer spending at stores,
restaurants and online, increased a seasonally adjusted 0.2% in
November from a month earlier to $528.0 billion, the Commerce
Department said Friday.
Sales declined sharply in November across a number of categories
that are closely tied with holiday gift-giving, including clothing,
electronics, department and sporting goods stores. Spending at bars
and restaurants also dropped 0.3% last month, the steepest monthly
decline since December last year.
Excluding the volatile categories of autos and gas, retail sales
were flat in November.
Robert Frick, corporate economist at Navy Federal Credit Union,
said that "retail sales point to more consumer caution" in a
commentary note. Still, Friday's report suggests consumers are
spending enough to support the expansion, he added.
As the traditional start of the holiday-shopping season,
November is a key month for retailers, especially for department
stores, clothing outlets and online sellers.
The month includes Thanksgiving Day and Black Friday, days in
which Americans crowd malls and shop online for deals. Due to a
late Thanksgiving, there are six fewer days in the holiday shopping
season this year compared with 2018. Cyber Monday fell in December
this year, and so wasn't accounted for in Friday's report.
At Rolling Oaks Mall near San Antonio, Phillip Iversen said
while most of his holiday shopping is now done online, certain
deals still bring him to the mall for Black Friday promotions.
Mr. Iversen found a waffle maker at Macy's inside Rolling Oaks
for about $7 on Nov. 28.
"I think they have to have the price that low now," the
35-year-old said of the deal.
November sales at electronics and appliance stores rose 0.7%
last month but slid 1.5% from a year earlier. Sales at nonstore
retailers, a category that includes internet merchants like
Amazon.com, were up 0.8% from October and grew 11.5% from a year
earlier.
Richard Derr, owner of Learning Express Toys in Lake Zurich,
Ill., said "this has been the strangest season I have ever seen for
toys." The season started slow with weak months in October and
November, and demand for December has only just started to pick
up.
"There's just this malaise that we see in shoppers. We know it's
not their pocketbooks," he said, citing the strong labor market and
rising incomes. "There's just an overhang that we see in shoppers
that they're really, really delayed this season."
Sales at motor vehicle and parts dealers, which make up about
20% of total retail sales, rose 0.5% last month. Gas station sales
advanced 0.7%.
The Commerce Department report paints a more pessimistic picture
of the start to the holiday season than separate data that suggests
strong sales so far, particularly in online spending.
Online holiday sales were up 14.1% from a year ago at $105.4
billion through Wednesday, according to Adobe Analytics, which
tracks activity on thousands on websites.
October retail sales were revised slightly higher in Friday's
report to a 0.4% increase. From a year earlier, November retail
sales increased 3.3%.
Weaker than expected sales in November suggests the pace of
consumer spending eased somewhat as the fourth quarter progressed,
which will feed into the broader pace of economic growth in the
October-to-December period.
The economy expanded at a 2.1% annual pace in the third quarter,
and forecasting firm Macroeconomic Advisers most recently projected
a 1.9% pace for the fourth.
The Commerce Department's retail sales report can be found at
http://www.census.gov/retail/marts/www/marts_current.pdf.
--Sebastian Herrera contributed to this article.
Write to Harriet Torry at harriet.torry@wsj.com and Amara
Omeokwe at amara.omeokwe@wsj.com
(END) Dow Jones Newswires
December 13, 2019 10:15 ET (15:15 GMT)
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