Economists' Outlook

Housing stats and analysis from NAR's research experts.

Instant Reaction: Retail Trade Sales, April 15, 2021

U.S. advance estimates of retail and food service sales for March 2021 recovered from the pull-back in February 2021 as consumer purchases exceeded expectations by increasing a seasonally-adjusted 9.8% for a total of $619.1 billion in sales. The primary motivators for the rebound originate from the continued government distribution of economic impact payments hitting consumer bank accounts, warmer weather, and increased COVID-19 vaccination rates, for which numerous states also eased pandemic-related restrictions that made it easier for consumers to return to some sense of normalcy as consumers continue to be the driving force accelerating the economy forward.

While March 2021s' year-over-year advanced estimates illustrate huge gains above March 2020 at 27.7%, the estimates are skewed as a result of two completely different economic environments. March 2020 saw the majority of stores reduce hours of operation, temporarily close and/or permanently close as a result of the coronavirus pandemic, while March 2021 was in a much better place. Sales in March 2021 illustrate continued high consumer sentiment as it reached its highest level since the beginning of the pandemic as consumers assessment of current economic environment and outlook increased significantly with increases in the labor market, stimulus check distribution, and the reopening of the economy.

The data released today illustrates consumer mobility as in-store foot traffic increased, with retail trade sales increasing 9.4% month-over-month and up 26.9% from a year ago. The March data confirms that consumers were encouraged to go out and spend by improved public safety/health conditions, the passing of holidays, and government policies. Consumers returned to their favorite food service and drinking places as advanced estimates were up 36% year-over-year, a dramatic shift from prior trends.

Although February saw month-over-month declines in every category except food and beverage stores, gasoline stations, and grocery stores, March is quite a different story. Increases in March blanketed all of retail sales month-over-month and year-over-year, with the exception of food and beverage, (-11.8%), and its sub-category, grocery stores (-13.8%), some of which retailers were deemed essential and allowed to stay open during the pandemic when other retailers were required to close.

Sporting goods, hobby, musical instrument, and book stores had the highest month-over-month increase at 23.4% with clothing and clothing accessory stores following with an 18.2% increase. On a year-over-year basis, clothing and clothing accessory stores had a dramatic increase of 101%.