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Retail Sales - 8/24/16

America’s economic recovery remains consumer led.  With government outlays expanding very slowing, business investment remaining soft, and erratic export growth, consumers have represented the only significant prime mover. 

That helps explain why retail sales and other data related to consumer outlays are attracting more attention than usual.  According to data recently released by the Commerce Department, U.S. retail sales hardly budged in July. 

Americans are spending on certain items, but are generally spending less on apparel and electronics, which show up in retail spending statistics, and more on entertainment, travel, and healthcare, which do not. 

As reported by the Wall Street Journal, demand for clothing and household in recent years has been noticeably softer than during past economic recoveries.  What demand there has been has been shifting online and away from traditional retailers like Macy’s, Kohl’s and Nordstrom, which all recently reported lower quarterly sales. 

Retail today represents a smaller slice of household spending with consumption of services now representing about two thirds of all personal expenditures.   

Anirban Basu, Chariman Chief Executive Officer of Sage Policy Group (SPG), is one of the Mid-Atlantic region's leading economic consultants. Prior to founding SPG he was Chairman and CEO of Optimal Solutions Group, a company he co-founded and which continues to operate. Anirban has also served as Director of Applied Economics and Senior Economist for RESI, where he used his extensive knowledge of the Mid-Atlantic region to support numerous clients in their strategic decision-making processes. Clients have included the Maryland Department of Transportation, St. Paul Companies, Baltimore Symphony Orchestra Players Committee and the Martin O'Malley mayoral campaign.