When it comes to shopping, U.S. consumers aren’t being swayed by snow, nor rain, nor … well, you get the idea.
The month of January brought bad weather for much of the country. But that didn’t stop consumers from heading to brick-and-mortar stores or online retailers in droves. The fact that overall retail sales grew in January is remarkable considering the volatility in global markets and overseas economies. The rise in retail sales is in line with other indicators of growing economic strength.
Still, it’s a small sample size, right? Well, last month actually stands as part of a greater trend. Total retail sales jumped 3.4 percent over the 12 months that ended Jan. 31, according to research by Marcus & Millichap.
There are two factors most responsible for the growth:
- The price of gas is low enough that consumers find themselves with more money to spend.
- Consumers have proven themselves willing to spend that money.
Spending in categories like food and drink (as well as more frivolous pursuits) is up across the board over the last 12 months. Further evidence of consumer confidence comes in the form of a rise in sales on larger, long-lasting items. Building materials and furniture sales rose over the past 12 months. Marcus & Millichap projects U.S. retail vacancy to drop 30 basis points to 5.9 percent in 2016.
It appears consumers are taking advantage of stable employment outlook and loosening up a bit. That’s great news for retail sales.