Did you hit the stores in January to scoop up some post-holiday deals? If so, you weren’t alone. Retail sales finally saw a boost in the first month of the year.
The Commerce Department says retail sales inched up 0.5 percent to $355.8 billion last month over December. That may not sound like much, but the good news is that it’s a trend in the right direction. Despite all the holiday shopping, December saw a drop of 0.1 percent in total retail sales over the previous month. What’s more, January’s sales were better than the increase of 0.3 percent economists had predicted, reports CNNMoney.com.
The retail numbers are an especially bright spot when compared to this time last year when we were in the thick of doom-and-gloom recession woes. Consumers spent 4.7 percent more this January than they did in ’09.
All this means that the economy may in fact be rebounding as we’ve all been told, but perhaps not quite felt just yet. Unemployment saw a dip in January, too, finally dropping below double digits to 9.7 percent and given that consumer spending accounts for a whopping two-thirds of economic activity in this country, a boost in retail sales is indeed a very good sign.
“This is decent news considering just how bad the labor market is,” says Adam York, an economist at Wells Fargo told CNNMoney.com. “We had gains in most of the categories and the real strength was in general merchandise sales, so it looks like the consumers are just out there shopping again.”
Online retailers saw the biggest gains with consumers spending 1.6 percent more in January than December, following an increase of 2.2 percent in December.
There’s been some concern that this month’s so-called “snowmageddon” that continues to sweep the country might affect retail sales for February, with shoppers being snowed in in front of the TV in their Snuggies, but consumers just might continue to shop online (in their Snuggies.)
Either way, to see any kind of sustained growth in consumer spending, we’re going to have to see a serious rebound in the job market, so let’s hope February’s unemployment numbers continue to trend downward.
Photo courtesy of robholland via Flickr.