Retail, Labor Indicators Looking Good
As the numbers begin trickling in after the cash registers cool down from the holidays, initial reports suggest it was a good Christmas for U.S. retailers in general, with First Data reporting a 4.7 percent year-over-year increase in retail sales during the season as part of its SpendTrend Holiday Season numbers.
First Data’s report added that, within retail, building materials, electronics, appliances, health and personal care stores saw the strongest growth, while clothing and accessories were softer with 0.1 percent growth.
Diving deeper into the numbers, Black Friday wasn’t the home run its been in past years, but mid-holiday-season sales growth and full season—taking into account the entire holiday shopping period—posted that 4.7 percent increase that will be the focus for many analysts, retail experts and investors.
Looking at some other indicators, the unemployment rate that’s now at 4.6 percent in November is forecasted to possibly fall another tenth of a percent, begging the question of how close the United States is to full employment when five percent has been the historical barometer. Demographic trends suggest the labor participation rate will continue to fall, as it has been for most of the decade.
Bolstering that sense of employment stasis, the Bureau of Labor Statistics reported that the number of job openings was “little changed at 5.5 million” on the last day of November. Zooming out for a wider picture, the number of labor openings hasn’t been this high since 2001, with hires at a level we haven’t seen since before the start of the Great Recession.
According to the National Federation of Independent Business (NFIB), small business optimism rose sharply during December to its highest level since 2004. Meaning a much larger number of business leaders “expect better business conditions,” that could have a significant impact on investment and heavy equipment sales in the coming quarter.
With so many economic indicators out there for the taking, there are data points to support every theory—but in looking at some of the most reliable, most trusted figures, the U.S. economy appears to be in solid shape at the start of the new year—but that might not be enough to dry the tears of brick-and-mortar retailers still facing enormous struggles. On that note, anyone placing bets on this being the year that finally tanks Sears/Kmart?