Consumers pulled back on post-holiday shopping and spending in the beginning of the year with severe winter weather in much of the country partially to blame, according to a report from the National Retail Federation.
The trade group reports January retail sales, excluding automobiles, gas stations and restaurants, were seasonally flat month-to-month, but sales rose 3% on an adjusted basis year-over-year.
“Following a solid holiday sales season, it seems that many consumers decided to take a break from the stores and shopping malls this January in an attempt to avoid winter weather,” NRF President and CEO Matthew Shay said in the statement. “While the dip in retail sales was somewhat anticipated, it is concerning that both jobless claims came in above projections and that consumer spending were flat in January – it’s not the way to kick off a new year.”
Congress did increase the debt ceiling this week, but Shay said more is needed to spur consumer confidence and spending, which is closely tied to employment data and economic opportunity.
The U.S. Census Bureau also released its January sales data, which includes automobiles, gasoline stations, and restaurants. The Census data indicates a 0.4% decrease in January sales on a seasonally adjusted month-to-month basis. Sales rose 2.6% adjusted year-over-year.
“Harsh winter weather is masking the performance of the broader economy,” NRF Chief Economist Jack Kleinhenz said. “Extreme temperatures and severe ice and snow are making it increasingly difficult to assess if the retail sales slowdown is temporary or a telling sign of a longer lasting weakness in the consumer-fueled economy. No one can jump to any solid conclusion until we shovel out of the snow.”
Earlier this month, NRF forecast a 4.1% increase in retail sales in 2014.
Other findings from the January retail sales report (year-over-year) include:
• Building material and garden equipment sales increased 3.3%.
• Clothing and accessory sales increased 1.4%.
• Electronics and appliance sales decreased 4.9%.
• Furniture and home furnishing sales decreased 2.1%.
• General merchandise sales increased 1.4%.
• Health and personal care sales increased 3.1%.
• Online sales increased 6.5%.
• Sporting goods, hobby, book and music sales decreased 1.5%.