NRF forecasts retail sales to grow 3.1 percent in 2016.
Experts predict that 2016 retail sales will mirror those of 2015, continuing the slow, steady, and plodding growth, and the National Retail Federation (NRF) has forecast that retail sales will grow just 3.1 percent in 2016.
The NRF projects that 2016 growth will be higher than the 10-year average of 2.7 percent, and that non-store sales in 2016 will increase between 6 and 9 percent.
“Wage stagnation is easing, jobs are being created and consumer confidence remains steady, so despite the headwinds our economy faces from international developments – particularly in China – we think 2016 will be favorable for growth in the retail industry,” explained Matthew Shay, NRF president and CEO. “All of the experts agree that the consumer is in the driver’s seat and steering our economic recovery. The best thing the government can do is stay out of the way, stop proposing rules and regulations that create hurdles toward greater capital investment and focus on policies that help retailers provide increased income and job stability for their employees.”
Paula Campbell Roberts, executive director, research, at Morgan Stanley, told the press that retailers will likely see “sluggish growth for a long time, unless there is something on a global level that shocks the economy.”
Data from the U.S. Commerce Department monthly sales report released February 12 found that total retail sales rose 2.1 percent in 2015, and experts expect similar growth for 2016. The NRF also reported that holiday sales - excluding automobiles, gasoline and restaurant meals - rose 3 percent in 2015, missing the federation's forecast of 3.7 percent sales growth in November and December.
Jack Kleinhenz, chief economist for the NRF, said that missing the forecast made 2015 "from some perspectives a disappointing year," but that people should realize that 3 percent growth "ain't all that bad."
“The economy had a bumpy ride in 2015 with fits and starts along the way,” explained Kleinhenz. “Despite the volatility, the economy continued to reduce unemployment, raise wages, and actually increase real GDP by 2.4 percent. Lower gas prices are creating more discretionary income to save, pay down debt and spend on travel, eating out and personal services. Retailers have benefitted well and continue to find ways to compete and succeed in a very cost-conscious environment.”
“The fact that we have had strong employment numbers is a good base going forward into 2016 and should keep consumers really engaged,” said Kleinhenz. “The challenge we have is that wages have not been all that superlative. But they should lift in 2016.”
