Consumer spending on apparel and footwear continued its slow steady slide in April, according to the most current data released by the Department of Commerce, rising by only 1.26% on a 12-month smoothed basis, its smallest monthly increase in four years. The rise was much lower than increases in total goods and nondurables spending, which gained 2.8% and 2.5%, respectively. In the past two years, growth of apparel and footwear spending has slowed from a peak of 6 percent in March 2012 to where it is today–barely keeping up with inflation.
Growth categories for discretionary consumer spending in April include automobiles and parts, smartphones, and meals eaten out–all of which grew by more than 4 percent in the month.
Footwear spending fared a bit better than apparel in the past two months. Apparel spending increased a nominal 1.15% in April, the smallest increase since April 2010. Spending on footwear, a category that enjoyed tremendous growth for years until it began to contract in 2013, rose by 1.65% in April on a 12-month smoothed basis.
Women’s apparel spending had the best performance in the month, increasing by 1.5%, ahead of both menswear, on which spending rose a mere 0.8%, and children’s, where spending actually declined for the third straight month.
Apparel and footwear spending as a percent of total disposable income, which is sometimes referred to as its “share of wallet,” fell from over 4.3% in 1994 to bottom out at just over 2.7% in June 2009. Since then, it has risen slightly to its current level of around 2.9%.
Despite spending $366 billion per year on the combined categories, Americans have been able to dedicate less of their budgets to clothing, due to declining prices and plentiful supply of product, freeing up dollars for more inflationary categories like housing, medical care and education. Spending on financial services has grown dramatically in the past four months as gains in financial markets have more people saving and investing.
