Road to Recovery: Retail Sales and Dow Surge By Matt Margolis
https://pjmedia.com/news-and-politics/matt-margolis/2020/06/16/road-to-recovery-retail-sales-jump-17-7-in-may-dow-surges-n540000
The Commerce Department reports that U.S. retail sales surged by a record 17.7 percent in May over the previous month, in part due to a rebound in consumer spending caused by the coronavirus recession, which caused many businesses to close or limit business.
The Associated Press reports that “retail sales have retraced some of the record-setting month-to-month plunges of March (8.3%) and April (14.7%) as businesses have increasingly reopened. Still, the pandemic’s damage to retail sales remains severe, with purchases still down 6.1% from a year ago.”
The changes have in many cases intensified the financial strain on traditional physical stores and boosted online purchases. Sales at non-store retailers, which include internet companies like Amazon and eBay, rose 9% in May after posting growth of 9.5% in April. Clothiers achieved a stunning 188% monthly gain, but that was not enough to offset a 63.4% drop over the past 12 months.
Retail sales account for roughly half of all consumer spending, which fuels about 70% of total economic activity. The rest of consumer spending includes services, from cellphone and internet contracts to gym memberships and child care.
Last month’s bounce-back comes against the backdrop of an economy that may have begun what could be a slow and prolonged recovery. In May, employers added 2.5 million jobs, an unexpected increase that suggested that the job market has bottomed out.
The bounce in May’s retail numbers suggests that the worst of the coronavirus recession is behind us.
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