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First Cut: After stocking up on essentials in March, consumers don’t spend on retail in April except online

Retail and food sales fell 16.4% in April after declining 8.3% in March (previously down 8.4%) and 0.4% in February. Compared to a year earlier, the dollar value of retail and food sales was down 21.6%.

Sales were dragged down in April by a 13.0% decline in motor vehicles, although that was less than the 27.1% plunge March. Consumers are not shopping for big ticket items generally and a loan for a motor vehicle purchase may be out of the question for people out of work – and there are massive numbers on the unemployment rolls at present.

Further declines in gasoline prices and less use of motor vehicles meant the dollar value of gasoline sale were off 28.8% from the prior month. I note that this was exaggerated by the seasonal factors which anticipated an increase in gas prices. However, that doesn’t change the basic story that the need for fueling up vehicles is greatly reduced during quarantines.

Building material sales were down 3.5% in April. Some of that is lack of discretionary funds for shopping and/or some simply avoiding stores during stay-at-home orders. But the category was far less affected that some others.
Sales at furniture and home furnishing stores were down 58.7%, largely because these weren’t open but also because consumers are not buying.
Restaurant sales reflected the widespread closures of dining rooms with a 29.5% drop in April. However, take out business has helped mitigate some of the losses there.

After stocking up in March, food and beverage store sales fell 13.1%. The same was true for health and personal care stores which fell 15.2%. Sporting goods languished with a 38.0% decline while these stores were closed. Clothing stores were down 78.8% just at the time they would normally benefit from the arrival of warmer weather.

In fact, the only category to do better in April was nonstore retailers which includes online stores and which were up 8.4% as consumers turned to delivery of goods via internet shopping.

Core retail sales – sales excluding motor vehicles, building materials, and gasoline – were down 17.2% in April. As noted above, consumers had stocked up on essentials in March and were not inclined and/or able to spend more than necessary.

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