Skip to main content

Apparel and Accessories Led September’s 1.9% US Retail Sales Uptick

Consumers surprised retailers and economists Friday as their proclivity to spend sent U.S. retail sales up 1.9 percent in September, representing the fourth month of gains.

Apparel and accessories stores led the advance, rising a seasonally adjusted 11 percent from August. That represented a sizable jump since August sales were up just 1.4 percent from July. Even sales at department stores saw strength, up 9.7 percent in September from August, which had slipped 2.2 percent from the July levels.

However, September’s data also represented a seasonally adjusted 12.5 percent decline year-over-year for apparel and accessories specialty stores. Sales at department stores also fell year-over-year, declining 7.3, seasonally adjusted.

In other categories, sales of sporting goods, music and books rose 5.7 percent, while electronics and appliances fell 1.6 percent in September, according to data from the U.S. Census Bureau.

And while retailers have touted online sales gains during the coronavirus outbreak, and expectations of continued digital strength, nonstore retailers for the month of September saw just a seasonally adjusted 0.5 percent increase from August. It was the year-over-year metric with a 23.8 percent jump that illustrates the notable consumer shift to digital once Covid-19 struck.

Monthly U.S. retail sales have been steadily ticking up since June, following the record monthly drops this spring during widespread store shutdowns.

“Retail sales are continuing to build on the momentum we’ve seen through the summer and have been boosted by an improving labor market, a rebound in consumer confidence and elevated savings,” Jack Kleinhenz, NRF’s chief economist, said. “A significant number of people remain unemployed, but more are going back to work and that makes them confident about spending. September retail sales reflect the support of government measures and elevated savings that is being spent now that consumers are shopping again. With less spending on personal services such as travel and entertainment outside the home, some of that money is shifting to retail cash registers. All in all, these numbers and other economic data show the nation’s economy remains on its recovery path.”

Related Stories

Economists were expecting just a 0.7 percent September increase, a hair of an uptick from the 0.6 percent gain in August. September’s rise came a welcome surprise given that the extra $600 in weekly federal benefits for unemployed Americans ended on July 31, which some believed contributed to the low increase in U.S. retail sales for August.

September’s data gives retailers a bit of hope that the trend will continue and give Holiday 2020 sales a boost to help them capture a bit of what they lost when Covid arrived into town.

“Consumers continue to prove their resilience and strength through this pandemic. Retailers and consumers are adapting to the current environment, embracing shopping in different ways and focusing on specific categories,” Matthew Shay, president and CEO of the retail industry trade group National Retail Federation, said. “We’re optimistic about the prospects for a strong holiday season, as people want something to look forward to and bring joy to their lives.”

Kearney’s Alex Fitzgerald says the retail sales numbers are “encouraging,” given the broad-based gains beyond electronics and appliances stores.

“The numbers also show the strongest August to September gains for clothing retail and department stores, which will be heartening for these retailers despite the figures still being significantly down versus Sept 2019,” Fitzgerald added. “The release of these numbers is especially relevant as retailers are in the midst of scenario planning for Holiday 2020 and many third-party consumer surveys are suggesting that consumers plan to spend less. This provides another, more optimistic data point for the retailers to triangulate against.”

Coresight Research founder Deborah Weinswig said that though “[a]pparel still struggles,” fashion might “be poised to rebound in Festival and Holiday season.”

She pointed to Coresight surveys suggesting that clothing sales stand to benefit from the return of the festival-themed shopping events around the year-end holiday season. “Festivals draw big crowds: 40.6 percent of respondents planned to either browse or purchase during our 10.10 event, while 73.1 percent expected to either browse or purchase during Prime Day,” she added. “Festivals inspire people to make apparel and accessory purchases: Clothing and footwear were the top categories respondents planned to browse or purchase; 48.8 percent of respondents said they would browse or buy apparel or footwear during the shopping festivals.”

However, Fitzgerald cautioned against too much optimism solely based on one month’s data. “In terms of consumer spending, a great deal of uncertainty exists, with the overall financial security of the consumer as well as the virus itself,” Fitzgerald said, adding that Prime Day‘s unofficial kickoff to the holidays ushered in an “extended deal season” in which “retailers offering multiple sales can test the market and learn from them iteratively.”

“Retailers will have a lot to iron out in the coming months with returns, curbside pickup, and other Covid-related consumer demands,” Fitzgerald said.