June retail trade sales rose 0.4% from May, and 3.3% year over year, according to the U.S. Commerce Department's monthly tally, released Tuesday. But May's numbers were revised downward, to a 0.3% rise from April and a 2.7% from May last year, from the previous measure of 0.5% from April, and 3.2% year over year, according to the report. Nonstore retailers (mostly e-commerce) were up 1.7% month over month and 13.4% year over year, the department said.
Along with gas stations, department stores (where sales fell 1.1% from May and 5.2% from last year) and electronics stores (where sales fell 0.3% since May and 5% since last year), were the only segments to see month-over-month declines. Sporting goods, hobby and bookstore sales were flat from May, falling 3.3% year over year. Clothing and accessories sales rose 0.5% month over month and fell 0.9% year over year; health and personal care store sales rose 0.5% month over month and 5.5% year over year, and furniture and home goods sales rose 0.5% month over month and 0.8% year over year.
The National Retail Federation also released its own take, using the government's numbers. Retail sales rose 0.6% in June, seasonally adjusted from May, and 2.3% unadjusted year-over-year, the NRF said in a report emailed to Retail Dive. Those numbers exclude automobile dealers, gasoline stations and restaurants, the organization said.
Retailers' June performance, which beat most expectations, demonstrates that the U.S. consumer remains "engaged," according to a statement from NRF Chief Economic Jack Kleinhenz emailed to Retail Dive. But he warned that tariff concerns could inflict some pain later in the year.
"The numbers are consistent with elevated consumer sentiment, healthy household balance sheets, low inflation and wage and job gains," he said. "The year-over-year growth is particularly significant given that it comes on top of strong gains at this time last year. While the prospect of tariff increases has subsided for the moment, trade uncertainties continue to weigh on the long-term outlook."
The upbeat results are poised to continue, but will most likely be found in certain segments of retail, according to Moody's Investors Service Vice President Mickey Chadha.
"We believe retail sales growth for 2019 will be over 4.0% led by e-commerce players like Amazon, off-price retailers like TJX and Ross, value and convenience oriented retailers like Dollar General and Dollar Tree, and discounters and warehouse clubs like Walmart and Target," he said in comments emailed to Retail Dive, noting that strong macroeconomic trends will remain, "with low unemployment and wage growth continuing to bolster retail sales."
That focus on discounts is likely a reflection of the penchant for low prices that many U.S. consumers have maintained even in the post-Great Recession recovery, which many experts peg to ongoing struggles for lower- and middle-income earners.
Still, the report shows that "spending has regained momentum this year after growth slowed to less than 2% in late 2018," according to Calvin Schnure, Senior Economist at Nareit, a national association of real estate investment trusts, who also said in comments emailed to Retail Dive that the economic growth and low interest rates are favorable for commercial real estate.