Retail sales without gas stations increased 0.8% in August from July. Inflation moved from goods (retail) to services.
By Wolf Richter for WOLF STREET.
There was a big drop in gas station sales, driven by a drop in gas prices and a drop in demand for gasoline (both of which I discussed yesterday).
But retail sales excluding gas station sales rose 0.8% in August from July, and have been on a solid upward trend for months, even as inflation has shifted from goods sold by retailers to services not sold by consumers. retailers.
Retail sales track sales of goods, not services. And inflation has been shifting from goods to services, and services inflation is now driving headline inflation (which I discussed a couple of days ago), even as the prices of some goods are going down.
Today’s retail sales data from the Census Bureau is based on surveys of about 5,500 retail businesses, by retail category, from the point of view of retailers, not from the point of view of consumers.
Total retail sales rose 0.3% from July, despite the drop at gas stations, and 9.1% year-on-year to $683bn (seasonally adjusted). Compared to August 2019, the last normal year, total retail sales are up a staggering 31.1%.
Retail inflation = price increases. But where?
Retail sales are grouped by retailer categories, such as car dealerships and e-commerce sales, and not by product category. But CPI inflation is measured by product category. Therefore, CPI inflation cannot be easily applied to retail sales because the categories do not match.
Headline CPI inflation in August increased 0.1% from July and 8.3% year-on-year. The CPI for services is rising steadily, but it doesn’t figure in retail sales because retailers sell goods.
CPI for gasoline: -10.6% in august july. But retail gas station sales include the other things they sell. Many gas stations are, in effect, convenience stores that sell food, drinks and other things, and the drop in the price of gasoline was moderated by increases in the prices of the other things they sell.
CPI for “food delivery”: +0.7% in August July, which falls under the retail category of “food and beverage stores.” But Walmart is also a large grocery retailer and is part of “general merchandise retailers,” not food and beverage stores.
CPI for durable goods: +0.5% in august july. Durable goods are sold by various categories of retailers, including new and used car dealers, e-commerce retailers, appliance stores, electronics stores, furniture stores, general stores, etc. and electronics) and with other prices rising (ie new vehicles).
Sales at new and used vehicles and parts dealers, the largest category, jumped 2.8% in August from July, and 6.8% from a year earlier, to $128 billion, seasonally adjusted. Compared to August 2019, sales increased by 21%.
This is due to a combination of much higher prices and much lower unit sales, as new vehicle dealers still face large-scale inventory shortages, although they have changed, with some brands now carrying a lot of inventory, while other brands have essentially no fuel. efficient vehicles.
Sales in e-commerce and other “non-store retailers” it fell 0.7% from July’s record, to the second highest on record, $108 billion, seasonally adjusted, up 11% year-over-year and 70% more than in August 2019.
This includes sales from pure e-commerce retailers, e-commerce operations from traditional retailers, and stalls and markets:
Food and beverage stores: Sales increased 0.5% in the month and 7.2% year over year, to $79.5 billion, up 23% from August 2019:
Food services and places to drink: Sales rose 1.1% in August from July and 10.9% year over year to a record $86 billion. This is up 32% from August 2019. This includes bars, restaurants, cafes, coffee shops, delis, fast food places, etc.
General merchandise stores: Sales increased 0.4% in the month and 4.2% year over year, to $58 billion, up 20% from August 2019. Walmart and Target are in this category, but department stores are not. :
Gas stations: Sales fell 4.2% in the month to $64 billion, the second straight month of declines, due to falling gasoline prices. Sales are still up 29% from a year ago and 51% from August 2019. Gas station sales include other things they sell: Many gas stations are convenience stores that sell all kinds of food , drinks, and other things, and the drop in the price of gasoline is moderated by price increases in its other things.
Building Materials, Garden Supplies and Equipment Stores: Sales increased 1.1% in the month and 10.5% year over year, to $43 billion, seasonally adjusted, up 36% from August 2019:
Clothing and accessories stores: Sales increased 0.4% in the month and 3.5% year over year, to $26 billion, up 16% from August 2019:
Miscellaneous store retailers (includes cannabis stores): Sales increased 1.6% for the month, 15% year over year and 47% from August 2019, to $16.2 billion:
Furniture and home goods stores: Sales fell 1.3% in the month and 1.6% year over year, to $11.8 billion. This was still 16% more than in August 2019:
Department store: Sales were up 0.9% for the month and just 0.7% year-over-year, and were essentially flat from August 2019, at $11.4 billion. Compared to high-demand department stores in 2000, sales fell 43%. Numerous department stores, from Sears onward, went bankrupt and mostly disappeared. Anything you can buy at a physical department store, you can buy online, even on that chain’s website, and that’s where these sales went:
Sporting Goods, Hobby, Book and Music Stores: Sales increased 0.5% month-over-month and 5.5% year-over-year to $9.3 billion, up 38% from August 2019:
Electronics and appliance stores: Sales fell 0.1% in the month and 5.7% year-over-year to $7.6 billion, which was flat from August 2019.
Only electronics and appliance stores, such as physical Best Buy stores or physical Apple stores, are especially found in this category. It does not cover other retailers that sell electronics and appliances, and it does not cover e-commerce sales of electronics and appliances. This category of physical stores is also slowly disappearing, with sales today 15% lower than 15 years ago:
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