STREAMING NOW: Watch Now

Consumers spent more last month, but ...

Lower retail sales in December, January and February raised fears that the main growth engine of the US economy was f...

Posted: Apr 16, 2018 8:23 PM
Updated: Apr 16, 2018 8:24 PM

Lower retail sales in December, January and February raised fears that the main growth engine of the US economy was finally slowing. But there's good news about American shoppers.

According to the latest figures from the government, retail sales rose 0.6% from February to March, higher than expected. Sales were up 4.5% from a year earlier.

Does this mean people no longer have to be concerned about the financial health of American consumers and their willingness to shop until they drop?

Perhaps.

People spent more on an array of things last month. The biggest jump in sales came from the motor vehicle and parts dealers category, where sales rose 2% from February.

But Michael Gapen, chief US economist at Barclays, noted that the furniture, electronics and health and personal care categories also notched solid gains. He thinks consumers are benefiting from the tax cuts enacted late last year.

Gapen thinks that consumers now have more money in their pocket because of lower withholding rates - and that Americans will keep spending because of the bigger paychecks.

Still, there are reasons to remain nervous. Nonstore retailers, a catchall category that includes internet and catalog retailers, enjoyed a strong sales pop last month.

That largely reflects the rise of Amazon, which is one of the reasons some retailers have been forced into bankruptcy. Nonstore retail sales rose 0.8% last month and surged nearly 10% from a year ago.

Related: Bed Bath & Beyond tanks on gloomy outlook

Many big American retailers are still struggling to compete with Amazon, as well as Walmart, which is aggressively boosting its digital operations.

What do those two retail giants have in common? They offer a lot of bargains. As long as consumers are hunting for discounts and wary of sticker shock, overall retail sales may suffer.

The biggest problem for retailers may be the fact that, despite a healthy job market, wage gains have been relatively stagnant. Wages rose 2.7% from a year ago in March.

Most experts think that number needs to be north of 3% before consumers will be truly willing to loosen the purse strings - or, if you prefer a more 21st century reference, unlock their phones.

"The consumer remains on uncertain footing," Lindsey Piegza, chief economist with Stifel, wrote in a report Monday. Piegza added that Americans need to see "sizable and sustained gains" in wages before that fog of uncertainty will lift.

In other words, it's probably way too soon to declare that US consumers are going back to their spendthrift ways.

Mississippi Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 36680

Reported Deaths: 1250
CountyConfirmedDeaths
Hinds304154
DeSoto200920
Madison150839
Jones123149
Harrison118316
Rankin113719
Neshoba104577
Forrest104343
Lauderdale97281
Scott83115
Jackson80419
Washington75313
Copiah67516
Leake63520
Lee63022
Grenada6259
Oktibbeha62328
Warren60021
Holmes59841
Lamar5847
Wayne56819
Yazoo5667
Lowndes54917
Leflore53956
Lincoln53835
Pike51120
Lafayette5094
Sunflower5058
Panola4616
Monroe46036
Simpson4533
Covington4505
Bolivar41618
Tate39513
Attala38624
Newton37710
Adams36720
Pontotoc3636
Marion34912
Claiborne31511
Pearl River30832
Chickasaw30219
Winston30211
Marshall2973
Jasper2826
Noxubee2799
Walthall2748
Clay26211
Smith25612
Union25612
Coahoma2356
Clarke22825
Lawrence2162
Yalobusha2089
Tallahatchie1974
Montgomery1863
Kemper18414
Carroll18311
Humphreys17410
Calhoun1705
Hancock15213
Itawamba1478
Tippah14711
Jefferson1373
Webster13511
Prentiss1274
Tunica1263
George1253
Jefferson Davis1254
Greene11610
Alcorn1112
Amite1113
Tishomingo1091
Quitman1011
Wilkinson1019
Perry914
Stone772
Choctaw764
Franklin572
Sharkey480
Benton470
Issaquena111
Unassigned00

Alabama Coronavirus Cases

Confirmed Cases: 54768

Reported Deaths: 1096
CountyConfirmedDeaths
Jefferson7012170
Mobile5061140
Montgomery4599112
Tuscaloosa274353
Madison25359
Marshall205012
Shelby176425
Lee164737
Morgan13975
Baldwin134111
Walker111332
Elmore107622
Etowah106914
Dallas10189
DeKalb10017
Franklin95016
Unassigned77728
Autauga71515
Russell7130
Chambers68530
Cullman6686
Limestone6653
Butler65529
Houston6417
Tallapoosa63069
Lauderdale6006
St. Clair5983
Calhoun5545
Colbert5286
Escambia5128
Lowndes49222
Pike4805
Jackson4422
Coffee4364
Covington43512
Talladega4177
Dale4061
Barbour4022
Bullock37810
Hale36323
Marengo36111
Chilton3452
Blount3311
Clarke3236
Wilcox3158
Marion30914
Winston3095
Sumter29713
Pickens2786
Randolph2759
Monroe2683
Perry2552
Conecuh2388
Bibb2271
Macon2229
Choctaw22012
Greene2009
Henry1573
Washington1529
Lawrence1460
Crenshaw1343
Cherokee1317
Geneva1010
Fayette901
Clay892
Lamar891
Coosa671
Cleburne481
Out of AL00
Tupelo
Clear
73° wxIcon
Hi: 94° Lo: 73°
Feels Like: 73°
Columbus
Overcast
73° wxIcon
Hi: 94° Lo: 73°
Feels Like: 73°
Oxford
Clear
68° wxIcon
Hi: 93° Lo: 72°
Feels Like: 68°
Starkville
Scattered Clouds
68° wxIcon
Hi: 91° Lo: 71°
Feels Like: 68°
WTVA Radar
WTVA Temperatures
WTVA Severe Weather