Americans sharply boosted their spending last month, pushing up retail sales and giving the economy a lift. Much of the gain reflected the fact that shoppers are also paying higher prices.
What You Need To Know
- Americans sharply boosted their spending last month, pushing up retail sales and giving the economy a lift
- Much of the gain reflected the fact that shoppers are also paying higher prices
- Retail sales rose a seasonally adjusted 1.7% in October from September, the U.S. Commerce Department said Friday, up from 0.8% in the previous month
- PoSolid hiring, strong pay raises, and healthy savings for many households are underpinning robust spending by U.S. consumers
Retail sales rose a seasonally adjusted 1.7% in October from September, the U.S. Commerce Department said Tuesday. That’s up from 0.8% in the previous month.
Solid hiring, strong pay raises, and healthy savings for many households are underpinning robust spending. Americans are also still buying more cars, furniture, and other goods than they did before the pandemic, which is overwhelming U.S. ports and shipping firms and pushing up prices.
“This morning, we learned that Advance Retail Sales increased above expectations in October and now are 16 percent higher than this time last year,” Brian Deese, Director of the National Economic Council, wrote in a statement Tuesday. “Sales at restaurants and bars are up more than 29 percent compared to this time last year and more than 9 percent compared to pre-pandemic levels.”
“In addition, retailer stores are benefiting from healthy sales numbers. And this morning, Walmart, the nation’s largest grocery and retail store, reported that it will have enough products to meet consumer demand over the holiday season,” he added. “In short, families have seen an increase in real disposable income, and stores and restaurants have the supplies to drive this recovery.”
Tuesday’s retail sales figures aren’t adjusted for inflation, which rose 0.9% in October, the government said last Wednesday.
“Today’s data show that even as we work to address the real challenge that elevated inflation from supply chain bottlenecks poses for Americans’ pocketbooks and outlook, the economy is making progress,” Deese wrote.
“Going forward, the Administration remains focused on growing our economy and bringing prices down for American families by tackling COVID-19, addressing supply chain challenges through implementation of the historic infrastructure package signed into law yesterday, and passing the Build Back Better Act which will boost the productive capacity of the economy and address key costs for middle-class families, including health care, housing, child care, and elder care,” he added.
Businesses and other employers are rapidly increasing pay to fill a near-record number of open jobs. Wages and salaries jumped in the July-September quarter, compared with a year earlier, by the most in 20 years. That’s giving more Americans extra money to spend.
Yet inflation has eroded those gains for most Americans. Prices jumped 6.2% in October from a year earlier, the government said, Wednesday the most in 31 years.
