The coronavirus outbreak delivered a record blow to the nation’s retail sales in March.
Retail sales saw their biggest monthly drop on record during March as restaurants, bars and many stores temporarily closed across the nation, reported the National Retail Federation (NRF). Among retail sectors, apparel stores had the biggest decline, with sales down 50.5% from February.
In contrast, sales rose 25.6% at grocery stores and were up at other retailers deemed “essential” as well, offsetting some of the decline.
“COVID-19 has hit the retail industry unevenly,” NRF chief economist Jack Kleinhenz said. “This is a market of haves and have-nots. The haves are the stores that remain open with lines out the doors to buy daily necessities while the have-nots are the stores that have closed and are taking the brunt of the impact of the pandemic.”
The U.S. Census Bureau said overall retail sales fell 8.7% in March from February and were down 6.2% year-over-year. The monthly drop is the largest ever recorded, exceeding a 4.3% decline in November 2008 during the Great Recession. NRF’s calculation of retail sales – which excludes automobile dealers, gasoline stations, bars and restaurants – showed March was up 1.7% from February and up 4.5% year-over-year. (The difference between the numbers is because the categories that NRF excludes, such as restaurants and bars, experienced some of the biggest hits, closing earlier in the month than many stores.)
As bad as things were in March, the situation in April is likely to be even worse.
“March was a month that started out with many stores still open, but far more are closed now,” Kleinhenz said. “Don’t be surprised if the data going forward shows a worsening situation. Even if the economy begins to reopen in May, consumer behavior may take a long time to adjust. The road to recovery could be long and slow.”
Clothing stores saw the biggest decline among categories counted by both NRF and the Census Bureau, with sales down 50.5% from February, while furniture store sales were down 26.8%.
On the positive side, grocery store sales rose 25.6%; general merchandise stores – which include warehouse clubs that sell both food and essential household products – were up 6.4% percent; and health and personal care stores, which include pharmacies, were up 4.3%. Online and other non-store sales rose 3.1%.
The March NRF numbers follow a decline of 0.2% in February from January as the coronavirus began to have its first effects. February sales were up 7.4% year-over year, but the increase was artificially high because of low sales following the government shutdown in early 2019. The three-month-moving average as of March was up 5.1%.
Here is a review of March sales month-over-month from the key retail sectors:
- Grocery and beverage stores were up 25.6%;
- General merchandise stores were up 6.4%;
- Health and personal care stores were up 4.3%;
- Online and other non-store sales were up 3.1%;
- Building materials and garden supply stores were up 1.3%;
- Electronics and appliance stores were down 15.1%;
- Sporting goods stores were down 23.3%;
- Furniture and home furnishings stores were down 26.8%; and
- Clothing and clothing accessory stores were down 50.5%.