Consumers are venturing back to retail stores and the numbers show it. U.S. retail sales jumped by a record 17.7 percent from April to May, with spending partially rebounding after the COVID-19 pandemic had shut down businesses. Specific retail sales numbers for Utah will be available later this month.
The Department of Commerce report last week showed that retail sales have regained some of the record-setting drops of March (8.3 percent) and April (14.7 percent) as businesses have increasingly reopened. Still, the pandemic’s damage to retail sales remains severe, with purchases still down 6.1 percent from a year ago.
May’s bounce-back comes against the backdrop of an economy that may have begun what is expected to be a slow and prolonged recovery. In May, employers added 2.5 million jobs, an unexpected increase that suggested that the job market has bottomed out. Still, a big unknown is whether early gains in job growth, retail sales and other areas can be sustained over the coming months or whether they may plateau at a low level.
May’s rebound was aided by the $3 trillion CARES act money that Congress provided to companies and households. Retail sales would need to surge by an additional 9 percent to return to their level before the pandemic. Retail sales account for roughly half of all consumer spending, which fuels about 70 percent of total economic activity. The rest of consumer spending includes services, from cellphone and Internet contracts to gym memberships and child care.
