THE NEUTRAL ZONE
U.S. retail sales hit a record low after mandatory business closures and millions of layoffs swept the nation. The figures account for non-essential businesses, restaurants, bars, and gas stations. The Commerce Department reported that total retail sales, including online and in stores, fell 8.7% in March – the lowest drop out of the three decades the Commerce Department has been tracking the data.
The non-essential business closures hit the clothing industry, sporting goods, and home furnishings the hardest, while grocery stores hit an all-time high – rising 27%. Sales at clothing stores dropped over 50% compared to last year’s numbers. Analysts are predicting that we will see these numbers continue to drop, as most businesses did not close their doors until the end of March and the beginning of May.
Swaths of U.S. Economy Froze in March – Bloomberg – April 15, 2020
“Large chunks of the U.S. economy froze in March as the coronavirus pandemic closed malls, restaurants, factories and mines, causing Americans to cut retail spending by a record amount and the country’s industrial production output to plunge at the steepest rate in more than 70 years. Retail sales, a measure of purchases at stores, gasoline stations, restaurants, bars and online, fell by a seasonally adjusted 8.7% in March from a month earlier, the biggest month-over-month decline since the records began in 1992, the Commerce Department said Wednesday.”
U.S. Experiences Worst Ever Single-Month Decline in Retail Sales amid Coronavirus Lockdown – The National Review – April 15, 2020
“The economic damage to consumer spending, which makes up about two-thirds of the country’s economic activity, is expected to continue despite the Trump administration’s $2.3 trillion economic stimulus package passed last month by Congress. The emergency package includes $250 billion earmarked for direct payments to Americans as well as $350 billion in loans for small businesses hit hard by the pandemic, $250 billion in expanded unemployment insurance, and $500 billion in corporate relief.”
U.S. stocks plunge amid steep fall in bank earnings, retail sales – The Washington Post – April 15, 2020
“Across the country, grocery shelves are picked clean of eggs and flour, toilet paper and disinfectant wipes. Delivery workers risk their lives to bring packages to people’s doorsteps. Wednesday’s figures from the Commerce Department show sales at food and beverage stores were up 28 percent compared with March 2019. But those dynamics don’t capture the full picture of just how abruptly spending has faltered.”
Jeffry Bartash on Twitter, 4/15/20 – It’s really hard to fathom the record 8.7% plunge in U.S. retail sales in March because of the coronavirus. Probably have to go back to the Great Depression to find something similar, but records don’t go that far back. And April will be worse!
Don Beyer on Twitter, 4/15/20 – Retail sales just plunged by an amount twice as bad as the worst of the Great Recession. It will get worse. Congress must give sustained support to workers and small businesses. We can set up mechanisms (automatic triggers) to keep relief flowing for the duration of the crisis.