U.S. retail sales rose a record 17.7% from April to May as a battered economy slowly started to reopen, but numbers still trail last year’s consumer spending as the coronavirus remains a challenge.
The May spike, which includes retail and food service figures, followed record plunging sales in March of 8.3% and April of 14.7% (a revised figure) compared to the previous month, according to the Census Bureau. But May sales were still down 6.1% compared to a year ago.
Consumer spending accounts for 70% of economic activity and shoppers pulled back on discretionary spending as layoffs abounded and local health orders shut down nonessential businesses like clothing, toy and furniture stores. Spending began to pick up last month as the the economy started to reopen despite rising COVID-19 cases and deaths.
May numbers fared better than the previous month as retailers began offering services such as curbside pickup and added to online capabilities, but still lagged a year ago. Clothing sales spiked 188% in May but still remain down 63% over the past 12 months. Furniture store sales surged 90% last month, but are still down more than 21% on the year. This same pattern holds for restaurants, electronics stores, department stores and auto dealers.
Analysts caution that some of the gains probably reflect temporary government aid and expanded unemployment benefits in the face of a deep recession. The national jobless rate is 13.3%, near a historic high. In the Bay Area, more than 136,000 layoffs have occurred in the last three months — 15,000 of which were in the retail sector, according to a Chronicle analysis. Prior to the pandemic, 1 in 12 workers in the Bay Area were retail workers.
Any sustained recovery depends on how willing consumers are to shop, travel and congregate in groups, how many businesses manage to stay open and rehire many workers and whether the government provides additional support.
San Francisco allowed storefronts to reopen doors Monday after shutting them down in March, but shoppers remained sparse at malls and neighborhood retail districts as many continued to stay home.
The Associated Press contributed to this report.
Shwanika Narayan is a San Francisco Chronicle staff writer. Email: shwanika.narayan@sfchronicle.com Twitter: @shwanika
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U.S. retail sales rebound in May, but lag behind last year amid coronavirus - San Francisco Chronicle
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