US retail sales may touch $5.23 trn in 2024: NRF

The 2024 sales forecast compares with 3.6 per cent annual sales growth of $5.1 trillion in 2023. The 2024 forecast is in line with the 10-year pre-pandemic average annual sales growth of 3.6 per cent.

Non-store and online sales, which are included in the total figure, are expected to grow between 7 per cent and 9 per cent year over year to a range of $1.47 trillion to $1.50 trillion. That compares with non-store and online sales of $1.38 trillion in 2023, the NRF said in a press release.

“The resiliency of consumers continues to power the American economy, and we are confident there will be moderate but steady growth through the end of the year,” NRF president and CEO Matthew Shay said. “Successful retailers offer consumers products and services when, where and how they want to shop with prices they want to pay.”

NRF projects full-year GDP growth of around 2.3 per cent, a slower speed than the 2.5 per cent in 2023 but strong enough to sustain job growth. Inflation prices are also expected to moderate to 2.2 per cent on a year-over-year basis, due to a cooling economy, the labour and product market coming into better balance and retreating housing costs.

“The economy is primarily supported by consumers who have shown much greater resilience than expected, and it’s hard to be bearish on the consumer,” NRF chief economist Jack Kleinhenz said. “The question for 2024 ultimately is, will consumer spending maintain its resilience?”

A tight labour market, with its robust job growth and wage gains fuelling consumer spending, is expected to cool in 2024. With the pace of the economy slowing in 2024, NRF expects about 100,000 fewer jobs on average per month compared with 2023 and the unemployment rate to average 4 per cent for the full year.

Kleinhenz also noted that consumer balance sheets and debt servicing levels remain in good condition. Rising home and stock prices in 2023 likely stimulated greater consumer spending via the so-called wealth effect and this should continue in 2024. Several surveys reveal that consumers appear to have a favourable outlook which should also support their willingness to spend. Yet, many consumers are feeling a pinch from tighter credit and inflation.

NRF’s calculation of retail sales excludes automobile dealers, gasoline stations and restaurants to focus on core retail.

Fibre2Fashion News Desk (KD)