Shoppers Are Still Spending on Shoes and Clothes — and They’re Even Returning to Department Stores

Retail spending in the United States climbed in September for the fifth month in a row, even as Americans saw a spike in the number of COVID-19 infections and some reopenings across the country were stalled.

According to the Commerce Department, retail sales — a measure of purchases at stores and online as well as automobiles, gas and dining sales — last month advanced 1.9% to $549.3 billion, compared with economists’ expectations for a 0.7% increase. That’s up from August’s revised 0.6% hike to $539 billion.

The report, released this morning, showed that consumers spent more on clothing and accessories, which recorded an 11% month-to-month jump, as well sporting goods and hobby stores, up 5.7%. Sales at general merchandise stores climbed 1.8%, with department stores surging 9.7%. While miscellaneous store retailers rose 1.1%, non-store (or online) retailers inched up 0.5%.

All other types of establishments — including restaurants, home improvement businesses and personal care stores — either saw gains or held steady. The only category in which shoppers pulled back their spending was electronics and appliance stores, which logged a 1.6% drop.

When the coronavirus pandemic took hold in the United States in March, retail sales recorded their steepest drop on record due to government-mandated lockdowns and restrictions on nonessential businesses. While chains that sold essential goods saw an uptick in sales, many companies in the fashion, footwear and accessories space were shuttered and ultimately resorted to furloughs or layoffs, leaving millions of Americans without jobs.

The lingering effects of lost wages depressed spending for discretionary purchases — and retailers felt the hit. A cascade of bankruptcies overwhelmed the sector, with boldface names including J.Crew, Neiman Marcus and JCPenney filing for Chapter 11 protection in a bid to keep their businesses alive. For big-box chains like Walmart and Target, however, coronavirus-panicked shoppers fueled demand both in stores and online, leading them to hire hundreds of thousands of workers to keep up with the rush.

What’s more, the jury is still out on a second stimulus bill that could provide a much-needed boost to the struggling U.S. economy. Two weeks ago, Democrats passed a measure worth $2.2 trillion, which is worth roughly the same amount as the Coronavirus Aid Response and Economic Security Act (or CARES Act) that was introduced at the end of March. Republicans countered the proposal with a separate $1.6 trillion package, but an agreement between both parties on the specific provisions and cost of another legislation has yet to be reached.

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