Restaurants were a steadying force during the recent run of uneven monthly retail sales reports. Barring any exogenous shocks, the expectation is that consumers will remain in a good position in the months ahead, which will support additional spending in restaurants, according to the NRA’s Chief Economist Bruce Grindy. His Economist’s Notebook commentary and analysis appears regularly on Restaurant.org and Restaurant TrendMapper.
Restaurants were a steadying force during the recent run of uneven monthly retail sales reports, according to an analysis of data from the U.S. Census Bureau. Eating and drinking place sales totaled $52.3 billion on a seasonally-adjusted basis in August, which represented a strong 0.7 percent increase over July’s sales volume of $52.0 billion.
August marked the seventh consecutive month of restaurant sales growth, with monthly gains not falling below 0.3 percent. In contrast, total retail spending experienced choppy results thus far in 2015, alternating between solid gains and flat-to-negative readings. August was no exception, with the modest 0.2 percent retail sales growth coming on the heels of a solid 0.7 percent gain in July.
Looking inside the retail numbers, sales were mixed bag. Miscellaneous store retailers (+0.9 percent), drugstores (+0.8 percent), restaurants (+0.7 percent), auto dealers (+0.7 percent), and grocery stores (+0.7 percent) all posted solid gains in August. In contrast, building supply stores (-1.8 percent), gas stations (-1.8 percent), furniture stores (-0.9 percent) and department stores (-0.2 percent) saw their sales dip in August.
The recent drop in gas station sales reflected the $0.46 decline in pump prices during the last 9 weeks, which will continue to be a positive driver for consumer spending moving forward. Consumers also continue to benefit from an improving job market, rising housing prices, dampened interest rates and low debt burdens.
Barring any exogenous shocks, the expectation is that consumers will remain in a good position in the months ahead, which will support additional spending in restaurants.