US retail sales up a record 17.7% after shutdowns

BALTIMORE – American shoppers ramped up their spending on store purchases by a record 17.7% from April to May, delivering a dose of energy for retailers that have been reeling since the coronavirus shut down businesses, flattened the economy and paralyzed consumers during the previous two months.

The government’s report Tuesday showed that consumers’ retail purchases have retraced some of the record-setting month-to-month plunges of March (8.3%) and April (14.7%) as businesses have increasingly reopened. Still, the pandemic’s damage to retailers remains severe, with purchases still down 6.1% from a year ago.

Last month’s bounce-back by consumers comes against the backdrop of an economy that may have begun what could be a slow and prolonged

materials and groceries. Building materials stores posted a monthly gain of 11% last month and yearover-year growth of 16%. Shoppers have increased their grocery purchases by an annual 14%, with fewer of them dining at restaurants because of the pandemic.

Shoppers last month vastly increased their spending in other categories, too, though some of these sectors still face a dim future given the blows they absorbed in March and April. Clothing purchases soared 188% from April to May but remain down 63% over the past 12 months. Though consumers ramped up their spending at furniture stores by 90% last month, sales remain down more than 21% year over year.

Americans’ retail purchases account for roughly half of all consumer spending, which fuels about 70% of total economic activity.

Nearly 80% of small retailers and restaurants tracked by the scheduling tool Homebase that were closed in mid-April have since reopened. Yet these smaller businesses remain under pressure. Their stresses in part reflect changes emerging as social distancing has become essential and shopping habits evolve.

One such retailer, CPW, a women’s clothing store, has been in business for 30 years on Manhattan’s Upper West Side. A three-month shutdown resulting from the virus meant the store retained only 20% to 30% of its sales as the owner, Linda Wolff, packed and delivered orders to customer homes. Though CPW reopened for curbside pickup a week ago,

Wolff said she hasn’t rung up a single such sale.

“This is my heart and soul,” she said. “I am exhausted from all the worrying.”

Some national chains, by contrast, say they have so far avoided their worst fears. Macy’s CEO Jeff Gennette has said that his company’s reopened stores are regaining 50% of their typical business. Teen retailer American Eagle Outfitters is faring even better, averaging roughly 95% of its normal sales levels.

U.S. retail sales likely recovered somewhat in May as the economy increasingly reopened from closures caused by the coronavirus and more shoppers felt confident enough to spend.