Retail sales in March saw double-digit year-over-year growth with federal stimulus money cited as the key driver.
According to the National Retail Federation (NRF), sales in the year’s third month were up 17.7% when compared to March 2020, a month when many states implemented shut-downs related to the COVID-19 pandemic.
“American households are clearly feeling the full effect of additional fiscal stimulus, gains in the job market and the reopening of the economy,” said Matthew Shay, president and CEO for the NRF. “Although there have been some recent issues related to vaccines, consumer confidence remains high and an optimistic outlook for the future continues to grow.”
The U.S. Census Bureau said overall retail sales in March were up 9.8% seasonally adjusted from February and up 27.7% year-over-year. That compares with a monthly decrease of 2.7% and a yearly gain of 6.7% in February.
“After a disappointing February, there was a perfect alignment of factors supporting a surge in shopping in March,” said Jack Kleinhenz, chief economist for the NRF. “Further reopening of the economy was encouraged by economic stimulus payments, the public health situation improved with more vaccinations, employment grew and there was seasonal activity around Passover, Easter and spring break.”
March retail sales increased across the board on a month-over-month basis and in every category except grocery on a year-over-year basis, the NRF said.
The year-over-year comparisons were dramatic in some categories – clothing store sales more than doubled – but were skewed because most stores were ordered closed in mid-March last year because of the pandemic. Grocery stores – the only category to show a year-over-year decline – were among the few retailers allowed to remain open.
March’s gains come as NRF is forecasting that 2021 retail sales will increase between 6.5% and 8.2% over 2020, for a total between $4.33 trillion and $4.4 trillion. Retail sales during 2020 increased 6.6% despite the pandemic, beating the previous record growth rate of 6.3% in 2004.