Summary
- Retail sales (excl. autos/parts/gas stations) increased 7.2% in
December, and decreased .7% over previous month
- Holiday sales (Nov/Dec) increased 6.8%
- Total year 2022 increased 8.7% above 2021
- December Food Services/Dining increased 12.1%
- Non-Store Retailer sales rose 13.7% over 2021
- Grocery sales were up 7.3% and all other major retail segments were under 4% YOY – Electronics declined nearly 6%
- Consumer Sentiment was down 3.9% vs. 2022 but rose over 8% MTM
- Current Conditions Index was up 15.5% over previous month, but recent changes in global factors may dampen progress in the early part of 2023
- Consumers continue to dip into savings / extend credit to cover
the gap between gains in personal income and inflation
- Personal disposable income rose 3.5% in November, still well below the November CORE CPI rate of 5.7%
- Personal consumption expenditures increased 8.8% and personal savings was down 2.4% (November) – revolving credit debt continues to climb, increasing 14.4%
- Inventories continue to challenge retailers, with Nov 2022 totals 18.4% above previous year; tepid consumer spending will create challenges for retailers as they move thru excess inventories thru discounting
- The Consumer Price Index increased 6.5% in December and Core
CPI increased 5.7%
- Food at home (groceries) and food away, as well as housing continue to drive the overall index; fuel declined slightly YOY
- Supply chain costs continue to stabilize; freight trucking was flat to last month and 4.2% above 2022; container freight rates continue to decline
- Retailers are taking another look at labor costs and starting to look at opportunities to do more with less, combating newly increased minimum wage rates, to eliminate non-value-added activities and increase store efficiencies to improve the customer experience
- Consumers shrugged off world events and inflationary pressures, opening their wallets and piling on revolving credit while enjoying the holidays thru gift giving and dining out
- Retailers now face significant challenges managing excess inventory and making careful decisions around purchase quantities for Spring 2024 goods while facing down a recession
Key Consumer Metrics
Consumer Sentiment Index
Consumer Sentiment was down 3.9% vs. 2022 but rose over 8% MTM; Current Conditions Index was up 15.5% over previous month – recent changes in global factors may dampen progress in the early part of 2023
Consumer Income and Spending
Personal disposable income rose 3.5% in November, still well below the November CORE CPI rate of 5.7%; personal consumption expenditures increased 8.8%
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