Retailers reported higher sales in November and the outlook looks strong for this winter, according to the Michigan Retail Index.
The November Retail Index survey came in at 52.2, a decrease from November 2018’s 63.5, and up from October 2019’s 43.0. The seasonally adjusted performance index is conducted by Michigan Retailers Association (MRA) in cooperation with the Federal Reserve Bank of Chicago’s Detroit branch.
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.
The November survey showed that 36% of respondents reported sales increases over October. Thirty-nine percent of retailers recorded declines and 25% reported no change.
The Retail Index shows that 39% of Michigan retailers expect increased sales through February, while 35% predict a decrease; 26% expect no change. That results in an adjusted outlook index of 63.0 – a strong sign for a solid winter.
“Consumers still are in a good place, with low interest rates, inflation and unemployment,” said William Hallan, President and CEO of Michigan Retailers Association. “We’re hoping that’s a good sign for December sales.”
Shoppers have six fewer shopping days this holiday season compared to 2018. But Super Saturday – the Saturday before Christmas and the biggest shopping day of the year – is expected to be huge nationally, according to the National Retail Federation. NRF predicts 147.8 million U.S. consumers will hit stores, up from 134.3 million last year, according to its survey in conjunction with Prosper Insights & Analytics.
Michigan sales tax and use tax collections were above 2018, but under the forecasted amount. Sales tax totaled $687.1 million in November, up 3.5% from November 2018, but $22.2 million below the forecasted amount. Use tax collections totaled $133.2 million in November, down 14.1% from November 2018 and $11.1 million below the forecast.
Michigan’s unemployment rate has not been announced for November. In October 2019 the unemployment rate was 4.1%. In November 2018, Michigan’s unemployment rate was 4.0%. The national rate is 3.5%.
Note: William Strauss, senior economist and economic advisor with the Federal Reserve Bank of Chicago, can be reached at 312.322.8151.
