Consumer spending is still strong, despite inflationary trends.
The U.S. Census Bureau reported today that retail and food service sales in April 2022 totaled $677.7 billion, marking a seasonally adjusted 0.9% increase from the previous month and a 8.2% leap from April 2021.
The bureau also amended its numbers for March sales to represent a sales total of $671.6 billion, or a 1.4% increase from February.
Within retail, consumer spending in April rose 0.7% from March and up 6.7% over last April. Sales at gasoline stations spiked 36.9% over last year, while food services and drinking sales were up 19.8% from last year.
Clothing and clothing accessories sales increased 0.8% from March and 8% compared with April 2021.
This growth in spending comes amid persisting high levels of inflation. Consumer prices rose by 8.3% in April compared to a year ago, according to the Bureau of Labor Statistics’ monthly report. This number was down from the 8.5% growth in March, which represented the highest inflation rate since the 12-month period ending in December 1981, but was up from the 7.9% in February.
The April spending numbers are not adjusted for inflation, which explains the massive 36.9% year-over year gain in gasoline station sales. Compared to last year, the energy index rose 30.3% in April and the food index rose 9.4%, the largest 12-month increase since the period ending April 1981, partially a result of the conflict between Ukraine and Russia, which has caused spiking prices on commodities like oil in the U.S.
The strong April retail sales numbers suggest that consumer spending remains largely undeterred by higher prices. Consumers were overall less concerned about mounting inflation pressures in April, according to new numbers released on Monday by the Federal Reserve Bank of New York’s Center for Microeconomic Data.
At the same time, more consumers are turning to secondhand shopping options to mitigate widespread price increases. The U.S. secondhand market is expected to more than double by 2026, hitting $82 billion, according to a recent report from ThredUp and GlobalData. Overall, resale is expected to grow 16x faster than the retail clothing sector in the U.S. by 2026.
In the report, ThredUp cited a GlobalData pulse survey of 2,000 U.S. adults conducted in April that found that 44% of consumers said they were cutting back on apparel purchases. 80% of consumers said that they are buying the same amount or more secondhand apparel items and 25% said they would consider buying even more apparel items secondhand if prices keep rising.