Sales at apparel, footwear and accessories retailers appear to be slowing down as the pandemic recovery continues to be uneven.
According to the Department of Commerce, total retail sales — a measure of purchases at stores, at restaurants and online — remained unchanged at $619.9 billion in April following an upwardly revised 10.7% spike in the prior month, when consumers were propelled by a new round of stimulus checks and pent-up demand. Economists had predicted a 0.8% gain for April.
Last month, sales at clothing and accessories stores as well as sporting goods and hobby stores — two categories that enjoyed double-digit gains in March — declined a respective 5.1% and 3.6%. General merchandise store sales fell 4.9%, and department stores — a subset of that category — dropped 1.9%. Miscellaneous store retailers decreased 1.1%, while non-store retailers dipped 0.6%.
Separately, sales at food services and drinking places jumped 3%; motor vehicle and parts dealers climbed 2.9%; and electronics and appliance stores rose 1.2%. Health and personal care stores saw a 1% uptick.
The retail sales report is the latest in a series of government data released over the past week that suggested the United States economy is facing new headwinds as it emerges from the COVID-19 health crisis. Last Friday, the monthly jobs report showed that employment improved by a paltry 266,000, and on Wednesday, the inflation rate recorded its largest advance in 12 years.
While some of the data is concerning for industry players, vaccine progress is fueling optimism. More than 264 million doses of the COVID-19 vaccine have been administered, and more than 117 million people — or roughly 35% of the U.S. population — are now inoculated. The continued rollout has likely tempered shoppers’ anxieties about returning to stores — some of which, including big-box chain Target, plan to enforce existing mask mandates despite new guidance from the Centers for Disease Control and Prevention that no longer requires vaccinated individuals to wear masks indoors and outdoors, except under certain circumstances.
The government is also still sending out stimulus payments to households that have yet to receive them as part of President Joe Biden’s American Rescue Plan. The $1.9 trillion COVID-19 relief package also provided an extension to the $300 in weekly jobless aid; money for vaccinations, testing and contact tracing; support for schools and small businesses; as well as funding for rental and food assistance, among other measures. Separately, Biden has proposed another sweeping economic plan centered on investments in infrastructure, clean energy, manufacturing, skills training and other domestic priorities. It also calls for higher taxes on capital gains for those who earn $1 million or more each year.