A strong summer tourism and back-to-school sales helped Michigan retailers post strong sales in August, according to the monthly Retail Index.
Michigan Retailers Association (MRA) conducts the monthly Retail Index survey in cooperation with the Federal Reserve Bank of Chicago’s Detroit branch.
In August, 56 percent of respondents reported sales increases over July, the survey showed. Twenty-one percent of retailers recorded declines in August and 23 percent reported no change. The results create a seasonally adjusted performance index of 73.2, a large leap up from the 53.5 performance index reported in July. A year ago, the Retail Index was 66.5.
The 100-point index provides a snapshot of the state’s overall retail industry. Index values above 50 generally indicate positive activity; the higher the number, the stronger the activity.
“A strong job market and more after-tax pay have helped boost our retailers,” said James P. Hallan, MRA President and CEO.
The Retail Index shows that 71 percent of Michigan retailers expect strong sales through November, while 12 percent predict a decrease and 17 percent expect no change. That results in an adjusted outlook index of 80.9 – a strong sign for a good fall.
Retailers were asked when they start promoting holiday shopping. Sixty-three percent said they plan to start after Nov. 1, 33 percent said they’d start during October and only 3 percent said they’ve already started.
With Halloween right around the corner, retailers should see a boost in candy, costumes and décor. According to the National Retail Federation, Halloween spending is expected to reach $9 billion dollars across the United States. Most of it – 95 percent – will be spent on candy.
Michigan’s jobless rate fell two tenths of a percentage from July to August, standing at 4.1 percent. The national rate is 3.9 percent. A year ago in Michigan, it was 4.6 percent.
According to the Senate Fiscal Agency, August 2018 sales tax receipts totaled $735.3 million, up 9.2 percent over last year.
Note: William Strauss, senior economist and economic advisor with the Federal Reserve Bank of Chicago, can be reached at 312.322.8151.
