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July figures show Michigan retail reboundingMichigan retailers’ sales and forecasts improved in July to their highest levels in more than a year. Projections for sales growth rose to their highest point since May 2002, and July sales performance was the best since January 2002, according to the Michigan Retail Index, a joint project of the Michigan Retailers Association (MRA) and Federal Reserve Bank of Chicago. According to the Index, which is based on a monthly survey of MRA members, 63 percent of retailers project increased sales for August-October over the same period a year ago, while 15 percent expect declines and 22 percent predict flat sales. The results create a seasonally adjusted outlook index of 71.4, up from 68.1 in June. It was the best August-October forecast in three years. Fifty percent of retailers increased sales in July from the same month a year ago, while 39 percent experienced declines and 11 percent reported no change. The results create a seasonally adjusted performance index of 54.3, up from 42.6 in June. It was the best July since 1999. “Michigan retailers’ sales performance registered the largest jump in many months and is in keeping with national reports of strong retail sales,” said Larry Meyer, MRA chairman and CEO. “Warm weather, heavy discounting and early back-to-school spending—fueled in part by the first wave of federal child-tax-credit checks—were chiefly responsible.” Sales tax collections totaled $578 million in July, which was down 8.8 percent from last year’s level. This sharp decline can be attributed largely to a noneconomic timing issue regarding the number of weekends in a month. Weekends tend to have a greater proportion of a week’s retail sales. When a month ends on a weekend, the tax revenue for those weekend sales is not collected until the first part of the next month. June of last year ended on a weekend, so July 2002 sales tax collections benefitted. Likewise, weekend sales from May 2003 inflated this June’s sales tax collection figures. Complete results of this month’s Michigan Retail Index—including data on sales, inventory, prices, promotions and hiring—are available at www.retailers.com/news/news.html. The website includes figures dating back to July 1994.
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