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Retail Sales Surge Despite Covid and the Chip Shortage Hurting Auto Sales

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18 comments on Retail Sales Surge Despite Covid and the Chip Shortage Hurting Auto Sales

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Upside Surprise

Advance Retail Sales for August surprised to the upside according to the Census Bureau’s Advance Sales Report.

  •  Advance estimates of U.S. retail and food services sales for August 2021 were $618.7 billion, an increase of 0.7 percent from July, and 15.1 percent above August 2020. 
  • Total sales for the June 2021 through August 2021 period were up 16.3 percent  from the same period a year ago. 
  • The June 2021 to July 2021 percent change was revised from down 1.1 percent  to down 1.8 percent. 
  • Motor vehicles sales declined 3.6% month from July and have been trending lower for four months on parts shortages.
  • Online sales were the big winner in August, up 5.3% from July.
  • Consumers shrugged off Covid concerns as food service sales were unchanged.

Q&A On Methodology

https://twitter.com/TBApple/status/1438556721602039815

Retail Sales vs Econoday Expectations

  • Total: -0.8% Expected vs 0.7% Reported
  • Ex-Vehicles: -0.1% Expected vs 1.8% Reported
  • Ex-Vehicles and Gas: -0.3% Expected vs 2.0% Reported

Sales were a blowout vs expectations even with the negative revisions. 

Advance Retail Sales Select Categories

Mote the impact of a chip shortage on autos sales.

Impact of Stimulus 

The three rounds of economic stimulus, one under Trump and two under Biden stands out. 

Despite the unexpected strength in August, sales are lower than they were following the last round of stimulus.

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18 Comments
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JG1170
JG1170
4 years ago
No one-time stimulus checks can beat not having to pay the landlord each month, not having to pay your mortgage, and even using the power all you want without paying and not fearing a shut off (as is the case with SCE in California). And that’s not even including all the PPP “loans” which are probably still sloshing around the system. The UI benefits may have been cut off (less than two weeks ago), but given how generous they were, the effects on spending will most like become apparent gradually, not all at once. In other words, give it a few more months and watch the fireworks appear in the data.
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Webej
Webej
4 years ago
adjusted for seasonal variation
and holiday and trading-day differences, but not for price changes
That’s a lot of confounding variables, especially since these times are not just like other years.
Maybe it’s just the inflation skewing purchases.
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Cocoa
Cocoa
4 years ago
I was interested in that new Ford Maverick Hybrid truck…supply chain and chip issues have delayed that vehicle for MONTHS
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PostCambrian
PostCambrian
4 years ago
I think it may be the last hurrah before the unemployment benefits and the eviction moratorium runs out.
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JG1170
JG1170
4 years ago
Reply to  PostCambrian
I agree, the effects will be gradual as not everybody used every last penny as it was coming in. Also, not having to pay the landlord is one heck of a stimulus. Wait until that goes away (it’s still in effect in California until October 1st….although Governor Gruesome will probably extend it indefinitely).
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JG1170
JG1170
4 years ago
Reply to  PostCambrian
Also a lot of people are getting their monthly child tax “refund” credit now AND California has been handing out Golden State stimulus checks, mostly to illegal aliens (two rounds so far). So it’s really no wonder we’re seeing a spike.
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RonJ
RonJ
4 years ago

A trade group that represents the nation’s meat processors, including
JBS USA, Cargill and Tyson Foods, blasted the Biden administration
Tuesday for https://nypost.com/2021/09/09/white-house-blames-big-meat-for-rising-prices-alleges-profiteering/ — saying the government “refuses to acknowledge” the real problem.

In a letter to US Department of Agriculture Secretary Thomas Vilsack, the North American Meat Institute https://www.meatinstitute.org/ht/display/ReleaseDetails/i/194721 were a result of a nationwide labor shortage — not consolidation of the meat industry.

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bobcalderone
bobcalderone
4 years ago
Reply to  RonJ
There’s a labor shortage in the meat industry because the jobs are difficult and dangerous. The  big companies are also addicted to illegal immigrant labor because they can exploit that group of workers.
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anoop
anoop
4 years ago
we have inflation so even if we sell less stuff, the total is higher.  sell fewer autos, but auto sales are up.  sell less gasoline, but gasoline sales are up.  and so on.
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numike
numike
4 years ago
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Casual_Observer2020
Casual_Observer2020
4 years ago
Reply to  numike
If anyone else has proposed this, it might be taken seriously. Since it was proposed by someone that conservatives and Republicans despise, it will be portrayed as a socialist agenda.
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tbergerson
tbergerson
4 years ago
Reply to  Casual_Observer2020
Even the worst people sometimes have good ideas.  And while GPI is definitely NOT the right way to measure things, GDP isnt either, especially now that we have outsourced all labor and destroyed our middle class. 
One of the primary things wrong with GDP is it includes government spending as one of its components.  You can juice GDP by juicing government spending.  And then the question becomes whether such spending has a positive or negative multiplier.  And that depends what it is spent on.  Generally the way it is done it is negative, as per Lacy Hunt, who is my personal go-to economist (so the least magical in his thinking for what is not really a science at ll but has devolved into a mathematical horror show to prove how scientific they are when measuring the aggregate measurements associated with complex human interaction which are by definition not really rational and theorizing what it all means).
Anyway, yeah no one with a brain really can like Ilhan Omar very much.  But she is right there must be a better way to measure economic well-being and progress.
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Eddie_T
Eddie_T
4 years ago
Reply to  tbergerson
“Anyway, yeah no one with a brain really can like Ilhan Omar very much.”
Unfortunately that does not matter.
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StukiMoi
StukiMoi
4 years ago
Reply to  tbergerson
No alleged measurement has much value, if the unit is measured in, is simply arbitrarily and unpredictably debased over time.
One way or the other, if you want to “measure” “the economy” (not saying it makes any form of sense, it doesn’t. But it is obviously a very fashionable thing to obsess over for those who don’t much comprehend nor care about making sense), at a very minimum, you need to find a measure where the unit it is measured in, is stable and well defined.
The number of miles of road is one. Kilograms of beef produced another. Average weight yet another. Number of people voting for the winning President yet another. And, a somewhat less bizarre one: Hours of leisure. Leisure is a fairly universal good. As people can afford more of it, they tend to do so.
The one measure which has, over time, correlated most closely with what most people broadly define as “wealth”, is energy available to the median person. Production of near everything, from travel to building to mining of anything fro Iron to Bitcoin, is largely energy constrained. Most who investigate human wealth increases over time, note that all the major periods where a society experiences obvious increases in “wealth”, “living standards” etc., tracks increased access to energy rather closely.
You can do an awful lot worse, than  looking at that one.
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anoop
anoop
4 years ago
Reply to  numike
the reason we are obsessed with gdp is that if it doesn’t keep going up, the banking system collapses.
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StukiMoi
StukiMoi
4 years ago
Reply to  anoop
And, unfortunately, a large share of the population is sufficiently illiterate and indoctrinated, that they keep falling for the trivially utter nonsense that “the banking system collapsing” is some sort of bad thing.
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KidHorn
KidHorn
4 years ago
Seeing as how sales are not inflation adjusted, the whole increase is due to inflation. Great news, you have to pay more now for the same stuff you bought last month.
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oee
oee
4 years ago
Reply to  KidHorn
Actually, there is no need for anything to look up, Nominal retail sales were .7 per cent less .3 CPI = .4 real increase in real retail sales. There you have it. 
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