National Retail Federation Anticipates Retail Sales for 2021 to Exceed $4.44 Trillion; Matthew Shay and Jack Kleinhenz Discuss
WASHINGTON, DC - The past year and a half for the retail industry has been about adjusting its footing to overcome new challenges, only to find stronger positioning and success in these recent moves. Proving this to be the case, the National Retail Federation (NRF) has issued its revised annual forecast for 2021, anticipating that sales for the entire retail industry will see between 10.5 percent and 13.5 percent growth, shooting up to $4.44 trillion this year. Although specific numbers were not given for grocery, this economic surge pattern will surely be seen in the sector.
“The economy and consumer spending have proven to be much more resilient than initially forecasted,” President and CEO Matthew Shay said. “The combination of vaccine distribution, fiscal stimulus, and private-sector ingenuity have put millions of Americans back to work. While there are downside risks related to worker shortages, an overheating economy, tax increases, and over-regulation, overall households are healthier, and consumers are demonstrating their ability and willingness to spend. The pandemic was a reminder how essential small, mid-size and large retailers are to the everyday lives of Americans in communities nationwide.”
Released at NRF’s inaugural State of Retail and the Consumer event, the revised forecast surpasses the organizations original projection of at least 6.5 percent growth which was made in February 2021. According to a release, the initial forecast was made when there was still great uncertainty about consumer spending, vaccine distribution, virus infection rates, and additional stimulus plans.
The NRF now predicts that 2021 retail sales will come in between $4.44 trillion and $4.56 trillion, with non-store and online sales—included in the figure—expected to grow 18–23 percent to a range of $1.09 trillion to $1.13 trillion. The forecast excludes automobile dealers, gasoline stations, and restaurants.
The updated numbers compare with $4.02 trillion in total retail sales in 2020, of which $920 billion was from purchases made through non-store and online channels.
“We are seeing clear signs of a strong and resilient economy,” NRF Chief Economist Jack Kleinhenz said. “Incoming data suggests that U.S. economic activity continues to expand rapidly, and we have seen impressive growth. Most indicators point toward an energetic expansion over the upcoming months and through the remainder of the year.”
Supporting the idea of economic resiliency, NRF is also projecting full-year GDP growth to approach 7 percent, compared with 4.4 percent and 5 percent earlier this year. Pre-pandemic levels of output are also expected to return this quarter.
Kleinhenz went on to explain that the amount of both fiscal and monetary policy intervention has helped lift personal income, filling the well of lost income from March and April 2020, creating an overabundance of purchasing power. Given the strength of consumer spending, he also noted he anticipates the fastest growth the U.S. has experienced since 1984.
To listen to a recording of the State of Retail and the Consumer event, click here.
Will the retail market reach these staggering numbers in 2021, and what will that mean for the evolution of the industry? Stick with AndNowUKnow as we go on the hunt for answers.