Retail sales charged back in January, giving a particularly big boost to department stores, which shot up a seasonally adjusted 23.5 percent compared with December, according to the Census Bureau.
Apparel and accessories specialty stores posted a more-moderate gain of 5 percent.
The month-to-month numbers, which smooth out changes in the calendar, offered an important sign for an industry still trying to claw out from the coronavirus.
Against a year earlier, January sales at department stores were down 3 percent and fashion specialty stores were off 11.1 percent.
The year-over-year reading might show that fashion is still in the hole, but eyes are firmly cast forward as companies look to rejigger coming out of the pandemic.
January numbers were a big boost.
Overall retail and food service sales grew 5.3 percent last month, compared with December, where economists were looking for a gain of just 1 percent. Against a year earlier, sales were down 1 percent.
While any sign of growth is welcome in the industry, there is little sense that it will ever revert back to how business was circa 2019, largely because of the step change in web sales as shoppers continue to seek to social distance.
Nonstore retailers, a category dominated by e-commerce that includes fashion web sales, saw January sales rise 11 percent from December and the category was up 28.7 percent from a year earlier, going from strength to strength.
Overall, 2021 is expected to show a strong rebound in consumer activity.
Customer Growth Partners recently predicted retail sales this year would increase 8.1 percent to a record $4.26 trillion even though the year is starting in the midst of a pandemic.
Meanwhile, the National Retail Federation reiterated its commitment to advocating for the industry, despite the encouraging momentum.
“January’s retail sales numbers reflect a very strong start for consumers and retailers as we look ahead to a critical year curbing the global pandemic and strengthening our economic recovery,” NRF president and CEO Matthew Shay said. “Consumers and the economy as a whole remain in good shape despite unprecedented adversity over the past year, and congressional action has been a lifeline for households and businesses disproportionately impacted by the pandemic.”
Shay added that NRF has gathered retail leaders and also spoken directly with the White House, underscoring the idea that it is “critically important for the government to work with retailers to get the vaccine into communities and administered as quickly and as safely as possible.”
NRF chief economist Jack Kleinhenz said the January sales uptick wasn’t unexpected, due in large part to stimulus checks, in addition to Covid-19 infection trends, panning out as hoped.
“There was none of the falloff in spending that we often find post-holiday and the increase was even better than expected,” he added. “There is plenty of purchasing power available for most consumers, and the pickup in shopping has even been reflected in the number of hours worked by retail employees. Confidence is building thanks to the availability of Covid-19 vaccines and states and local governments are beginning to remove restrictions on economic activity. Going forward, I expect consumer spending to build on this momentum.”
Additional reporting by Jessica Binns.