March retail sales plunged 8.7% from February and were down 6.2% compared to a year ago. Sales excluding motor vehicles were down 4.5% month-over-month and off 1.7% compared to March 2019. So-called “core” retail sales – sales excluding motor vehicles, building materials, and gasoline – were down 3.5% in March and a mild 0.7% lower year-over-year. Although the dollar value of retail sales was below market expectations, the composition was much as expected. Consumers went on a binge for essentials and closed their wallets for everything else – sometimes out of sheer necessity where stores were shuttered. Now that consumers have stuffed their closets with nonperishables, sales are going to be limited in the April data.
Motor vehicle unit sales fell sharply in March, so the dollar value of sales at auto and other motor vehicle dealers fell 27.1%. The price per gallon of gasoline was nearing four-year lows at a time when consumers were staying at home, so sales at gasoline service stations were down 17.2% month-over-month. With being home bound and the weather mild, many consumers took on home projects. Sales of building materials and garden equipment were up 1.3%.
The necessity to stay at home and concerns about the availability of medical and emergency supplies sent consumers to stores to stock up where they could. Health and personal care stores saw sales increase 4.3% in March from February and food and beverage outlets climbed 25.6%. Nonstore retailers – which includes online sales – were up 3.1% as many consumers opted to shop from home to avoid contagion and/or sought out goods not available in stores.
Conversely, it was no surprise that sales at restaurants dropped 26.5% in March and consumers declined to update their spring wardrobes this year amid widespread closures at nonessential retail outlets. Clothing store sales lost 50.5% month-over-month and department stores were down 19.7%, although the general merchandise stores of which it is a subcomponent gained 6.4%. Sales at sporting goods were down 23.3% and miscellaneous store sales were 14.3% lower.
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