An employee hauls early Black Friday sale items at a Best Buy in San Diego, Calif., on Nov. 20.Gregory Bull/The Associated Press
Sales at U.S. retailers and restaurants rose slightly in September as resilient consumers moderated their spending after splurging over the summer.
Sales increased 0.2 per cent last month from August, the Commerce Department said Tuesday, in a report delayed more than a month because of the government shutdown. Many reports on inflation, employment, spending and growth remain delayed and the government won’t likely be caught up until late December.
The retail sales figures suggest that Americans as a whole are still willing and able to boost their spending, a key driver of the economy, despite high prices for groceries, rent and many imported goods hit by tariffs. Steady consumer spending may lift the economy’s growth to a solid 3 per cent or higher annual rate in the July-September quarter, economists forecast, after a modest 1.6-per-cent expansion in the first half of the year.
At the same time, hiring has been weak and the unemployment rate has ticked higher, which could drag down consumer spending and the broader economy if it worsens. Unemployment rose to 4.4 per cent in September, the highest in nearly four years, from 4.3 per cent, according to the delayed monthly jobs report released last week.
Higher-income consumers are driving much of the gains, according to data from Bank of America and reports from retailers such as Walmart, as lower-income shoppers seek bargains and are more likely to spend more on necessities.
Tuesday’s report comes before the crucial winter holiday season kicks off this weekend, when retailers earn as much as a fifth of their revenues. The National Retail Federation and other forecasters expect modest sales gains this year, compared with last year’s holiday, with the NRF projecting that sales will top US$1-trillion for the first time.