May retail sales were still 28% higher than they were last year when many non-essential stores were closed.
Strong year ahead
Clothing stores were a bright spot last month. Sales at clothing stores increased 3% in May from the month prior.
Areas that have surged in the pandemic such as electronics and sporting goods’ stores declined last month. Sales at electronics stores dipped 3.4% while sporting goods’ store sales dropped 0.8%. Sales at online stores also dropped 0.8% in May.
Still, America’s retail industry is expecting a strong year thanks to more consumers getting vaccinated and returning to stores, as well as fiscal stimulus boosting consumer spending in the first half of 2021.
The National Retail Federation, an industry group, expects retail sales to grow between 10.5% and 13.5% to more than $4.44 trillion this year, nearly double a previous forecast it gave in February.
“The economy and consumer spending have proven to be much more resilient than initially forecasted,” NRF CEO Matthew Shay said last week.
Non-store sales — the bulk of which come from online — are expected to grow between 18% and 23% this year, NRF projects.
Retailers that struggled in 2020, such as clothing chains and department stores, have said consumers are shopping again for apparel, luggage and other categories they saw little need for while they sheltered at home.
Retailers still face big challenges, however.