U.S. retail sales post strong numbers in May, despite slight sequential decline

United States May retail sales saw a slight sequential decline and a strong annual increase, according to data issued today by the United States Department of Commerce and the National Retail Federation.

Commerce reported that May retail sales—at $620.2 billion—were off 1.3% compared to April and up 28.1% compared to May 2020, whereas April retail sales saw a 0.9% sequential gain and a 53.4% annual increase. And from March through May, total retail sales rose 36.2% compared to the same period a year ago.

Looking at specific verticals, Commerce reported that retail trade sales fell 1.7% sequentially and were up 24.4% annually, with clothing and clothing accessories seeing a 200.3% annual gain. Food services and drinking places increased 70.6% annually.

NRF officials noted that the April and May annual gains were unusually high, due to the same months in 2020 were closed, due to the COVID-19 pandemic, adding that retail sales have seen annual gains for each month going back to June 2020.

As for its own data, NRF’s retail sales calculation, which excludes automobile dealers, gas stations, and restaurants, for May, showed a 1.2% seasonally-adjusted decline compared to April, with a 17.3% unadjusted annual gain, whereas April was off by 0.6% compared to May and were up 30.9% annually, adding that NRF’s data showed a 22.3% unadjusted increase on a three-month moving average. What’s more, NRF said that unadjusted retail sales in May came in at $388.6 billion, which it said represents the second-highest level of monthly retail spending on record, trailing December 2020s $414.7 billion.

NRF recently revised its 2021 retail sales forecast, now projecting an annual gain between 10.5% and 13.5% to between 10.5% and 13.5%, to $4.44 trillion and $4.56 trillion.

For specific industries, NRF said online and other non-store sales are pegged to rise between 18%-to-23% annually, to $1.09 trillion and $1.13 trillion.

“Month-over-month comparisons and percentages of change simply don’t tell the story,” NRF Chief Economist Jack Kleinhenz said in a statement. “We are at a highly elevated level of spending, with dollar amounts in recent months some of the highest we’ve ever seen. Long-term trends in the number of dollars spent tell much more about the continuing economic recovery than whether sales were up or down from month to month. Retail sales as calculated by NRF were the second highest on record in May, topped only by holiday spending in December. Demand has continued to be strong even as the concentrated impact from government stimulus has faded. There is still pent-up demand for retail goods and consumers are likely to remain on a growth path into the summer.”