Xander Snyder, senior commercial real estate economist for First American Financial Corporation, offers a different perspective on the U.S. Census Bureau’s “Advance Monthly Sales for Retail and Food Services – August 2023” report. While the report shows an overall increase in sales from last year, Snyder points out that this growth is not adjusted for inflation and therefore does not accurately reflect the challenges faced by consumers.
According to Snyder, adjusting retail sales growth for inflation reveals a decline in real consumer spending of 1.2% compared to last year. This trend has been ongoing since February 2023 and is reminiscent of the Great Financial Crisis in 2008-2009.
However, it should be noted that comparing today’s numbers to those during the GFC may not be entirely accurate as retail sales are still higher than pre-pandemic levels. Additionally, there are variations among different types of retail locations and experiences matter when it comes to consumer spending.
Snyder cautions against making broad assumptions about all consumer spending activity based on these numbers alone as experiential locations have shown more resilience compared to non-experiential ones during this slowdown period.
In conclusion, while there may be some cause for optimism with regards to overall sales figures from last year according to The U.S Census Bureau’s report , it is important to take into account factors such as inflation when analyzing these numbers accurately.
