Retail sales show healthy jump in April

April’s retail sales were 0.4 percent higher compared to March and 2.8 percent higher compared to a year ago.

The sales data, from the National Retail Federation, does not include sales at gas stations, restaurants or auto sales.

“Retail sales growth remains solid and on track as households benefit from tax cuts even though they have faced unseasonable weather and bumpy financial markets,” NRF Chief Economist Jack Kleinhenz said in a press release on the data. “The tax cuts and higher savings levels should help consumers afford the recent surge in gasoline prices. And a solid job market, recent wage gains and elevated confidence translate into ongoing spending support.”

 

May Retail Jobs See Huge Year-Over-Year Increase

he retail industry employment increased by 28,800 jobs seasonally adjusted in May over April and 100,200 jobs unadjusted year-over-year, the National Retail Federation said Friday. The numbers exclude automobile dealers, gasoline stations and restaurants. Overall, U.S. businesses added 223,000 jobs, the Labor Department said.

“May’s rebound in jobs, together with yesterday’s report of solid income growth and the rise in consumer confidence, points to the economy functioning very well,” NRF Chief Economist Jack Kleinhenz said. “Solid fundamentals in the job market are encouraging for retail spending, as employment gains generate additional income for consumers and consequently increase spending.”

“With the unemployment rate of 3.8 percent at its lowest since April 2000, this shows that many industries, including retail, are hiring and creating jobs at a steady pace. We expect this rate to continue to decline as the fiscal stimulus and tax cuts are further absorbed in the economy,” Kleinhenz said.

May’s numbers followed an upwardly revised combined increase of 19,300 jobs for March and April. The three-month moving average in May showed an increase of 19,000 jobs.

Retail registered monthly gains nearly in all segments with the most robust increases concentrated in three sectors: general merchandise stores, which were up 13,400; clothing and clothing accessory stores, up 6,500 and building and garden supplies, up 6,000. Losses were concentrated in two sectors: health and personal care stores, down 800 jobs and non-store which includes online, down 1,100 jobs.

Economy-wide, average hourly earnings in May increased by 8 cents–2.7 percent–year-over-year.

Kleinhenz noted that retail job numbers reported by the Labor Department do not provide an accurate picture of the industry because they count only employees who work in stores while excluding retail workers in other parts of the business such as corporate headquarters, distribution centers, call centers and innovation labs.

NRF: Retail Employment Gains

According to the National Retail Federation, retail industry employment in the U.S. increased by 28,800 jobs seasonally adjusted in May over April and 100,000 jobs unadjusted year-over-year.

The numbers exclude automobile dealers, gasoline stations and restaurants. Overall, U.S. businesses added 223,000 jobs, the NRF said, citing U.S. Labor Department figures.

May’s retail employment follows an upwardly revised combined increase of 19,300 jobs for March and April. The three-month moving average in May increased by 19,000 jobs.

The sectors demonstrating the strongest employment growth were general merchandise stores, up 13,400 jobs; clothing and clothing accessory stores, up 6,500 jobs; and building and garden supplies, up 6,000 jobs. Employment declines occurred in health and personal care stores, down 800 jobs, and non-store including e-commerce, down 1,100 jobs.

“May’s rebound in jobs together with yesterday’s report of solid income growth and the rise in consumer confidence points to the economy functioning very well,” said Jack Kleinhenz, NRF chief economist. “Solid fundamentals in the job market are encouraging for retail spending, as employment gains generate additional income for consumers and consequently increase spending.”

COMMERCIAL DESIGN LEADS RESULTS IN THE LATEST ASID BILLINGS INDEX

The AMERICAN SOCIETY OF INTERIOR DESIGNERS (ASID) has released its Interior Design Billings Index (IDBI), a statement on the latest trends and BEST PRACTICES in design as well as an indicator of the economic health of the industry. Per the first quarter’s monthly reports, which are gathered from ASID panelists, the latest IDBI shows positive projections for 2018.

Regional performance was one of the larger variations reported in the findings. While the Midwest, West and South witnessed a continued increase, the Northeast region suffered a drop in business—a finding that principal and chief economist Jack Kleinhenz of Kleinhenz & Associates attributes to harsh weather conditions in the region this winter.

Commercial design leads results in the latest ASID Billings Index“As we move further in 2018, that’ll help provide some fuel for maybe some spending in the industry.”

Commercial and institutional design firms experienced an increase in work in the first quarter, while single-family and multifamily residential projects continue to endure a steady decline. Yet, Kleinhenz says, the economy is broadly improving, as recent tax cuts are offering Americans an increased take-home pay.

“It’s certainly an incentive for [people] to make MORE INVESTMENTS in their homes,” says Kleinhenz. “As we move further in 2018, that’ll help provide some fuel for maybe some spending in the industry.”

Following the industry billings report, Susan Chung, director of research for ASID, presented a work assessment of the interior design profession. Members’ responses contributed to the informative results, which revolved around pay, work management and more.

Are you expecting a pay increase this year? The questionnaire asked. More than half of respondents answered positively, with an average increase of 5.2 percent in pay expected in 2018. “Although we do see pay increases happening, we also see that the hours we work are also slightly increasing,” Chung points out.

Nearly half of those surveyed reported working 40 to 50 hours on average per week, and 23 percent claimed to work more than 50 hours. The results showed that those who worked more hours tended to work at larger firms.

The survey also reviewed work-management systems, asking if respondents expected to hire any additional employees this year. Thirty percent of participants claimed to have already made a new hire in the first quarter, while an additional 10 percent of respondents answered affirmatively.

Yet when asked if they’ve made any investments in their firms (i.e., purchasing or billing software, design software, hardware, etc.) during the first quarter, 60 percent of respondents declined.

In the six-month forecast, however, Kleinhenz is hopeful, saying: “It reflects an improving broader economy in general and a positive outlook for the design services industry in the coming months.”

The full report can be found HERE.

May retail sales surge 6% over last year

Dive Brief:

  • Retail trade sales rose 0.8% in May from April, and 6% percent from May last year, according to the latest monthly report from the U.S. Commerce Department’s census bureau. Excluding automobiles, gasoline stations and restaurants, May retail sales rose 0.7% from April and 5.6% from May last year, according to the National Retail Federation.
  • Most categories are benefiting from the healthy economy. Monthly furniture and home goods sales dropped 2.4% (rising 3.5% year over year) and sporting goods, hobby and bookstore sales dropped 1.1%. (declining 0.7% year over year). But electronics sales rose 0.2% (1.9% year over year), department store sales rose 1.5% (2.1% year over year) and apparel and accessories sales rose 1.3% (5.9%) year over year, the government said.
  • E-commerce sales rose 0.1% from April and 9.1% year over year, according to the federal report.

Dive Insight:

The U.S. economy, underpinned by strong growth and employment, is operating on all cylinders, and that is boosting retail sales and is evident in most earnings reports of late. Increases in household budgets from tax changes and good credit availability are also helping, according to NRF Chief Economist Jack Kleinhenz.

“The economy is looking strong and households have a solid financial foundation on which to base their spending,” he said in a statement this week. “We have seen ongoing momentum over the last several months and believe sales growth should remain healthy and consistent with our 2018 outlook.”

The three-month moving average rose 4.6% over the same period a year ago, topping NRF’s forecast earlier this year that retail sales this year will grow between 3.8% and 4.4%, the organization said.

But while the near-term outlook remains strong, tax reform and the administration’s new tack on trade could undermine all that, according to the International Monetary Fund’s latest report card on the U.S. economy. Tax cuts and spending policies mean the federal deficit will exceed 4.5% of GDP by 2019, and tariffs being imposed and proposed “are likely to be damaging to a range of countries, and to U.S. multinational companies, that are reliant on these supply chains,” the IMF said.

That includes retailers, and Kleinhenz agrees that there’s trouble on the horizon. “[I]nflation and rising oil prices are complicating the picture,” he said. “And new tariffs or a trade war would certainly be negatives that would increase prices and reduce both consumer purchasing power and consumer confidence.”

Retail Dive

Cleveland’s economy fails to gain traction

A better job of measuring performance is key to turning around region’s fortunes

Illustration by Daniel Zakroczemski for Crain’s

While there is some question about whether he actually said it and exactly how he said it, business thinker Peter Drucker is credited with a mantra that has wide acceptance in management circles: “You can’t improve what you don’t measure.”

Expanding on that maxim, the need to better measure the strengths and weaknesses of the Northeast Ohio economy, as a prelude to improving it, may end up being a key takeaway from Jon Pinney’s June 8 speech at the City Club of Cleveland. There, the managing partner of the Kohrman Jackson & Krantz law firm pronounced that the Northeast Ohio economy was “dead last or near the bottom in most economic metrics.”

He cited recent national media coverage, such as Forbes’ “Best Cities for Jobs”survey, which ranked Cleveland last out of 71 major metro areas, and Business Insider’s ranking of the country’s 40 best and worst regional economies, where Cleveland also placed last.

As Business Insider reported, Cleveland had the highest February 2017 unemployment rate, at 5.7%, among the 40 biggest metro areas, and its job growth was the second-lowest, with non-farm payroll employment rising just 0.3% between February 2016 and February 2017.

The struggles of the region’s economy are nothing new. Some data make that point when they are periodically announced, such as Census Bureau reports that show the region’s population decline and when the Labor Department announces the monthly unemployment rate.

Pinney was highlighting the need to pay more attention on a regular basis to those and other measurements of the region’s performance and to compare that performance to other regions. He closed his comments by making a “grand challenge” to business and civic leaders to face up to the region’s poor showing when compared to the rest of the country and find solutions to the region’s economic sluggishness.

Before that can happen, however, the region needs better data — data that have not been as readily available in Northeast Ohio as they are in some other areas.

In Columbus, for example, Columbus 2020, the region’s economic development agency, posts on its website updated monthly data on the size and composition of the regional workforce, including a graph which shows if the employed workforce is growing or declining and a pie chart of which industries employ the most people.

It’s a barebones example of what economists call an “economic dashboard.”

Greater MSP, an economic development agency in the Minneapolis-St. Paul region, goes further. Its “Regional Indicators Dashboard” tracks changes in more than 50 economic, environmental and social outcomes and how the region ranks with a peer group of regional economies. It includes everything from average weekly wages to percentage of the population with a college degree to the cost of electricity.

Don Iannone, a Highland Heights-based economic development consultant, produced a dashboard for Ashtabula County after becoming CEO of the Growth Partnership for Ashtabula County in 2014. It provided a wide variety of regularly updated information for several years covering data on employment and business formation in the county.

But because the economy was struggling, business and civic leaders weren’t always happy to see their economic difficulties on display on the internet.

“People didn’t like the bad news. They just didn’t,” he said. But to him, it was a necessary regular assessment. “I said, it’s actually like going in for a physical and the doctor gives you all the news, good and bad,” Iannone said.

In 2005, the Federal Reserve Bank of Cleveland produced an economic dashboard proposal for the Fund for Our Economic Future, a collaboration of foundations and other philanthropies that focuses on regional economic development. The goal was “to encourage and advance a common and highly focused regional economic development agenda that can lead to a long-term economic transformation of the Northeast Ohio (NEO) economy.”

The work, said one economist who worked on the project, was noble, but was overwhelmed by other priorities at the time.

“The great recession had a major influence on how we could approach this activity,” said Jack Kleinhenz, an economist now running Kleinhenz & Associates in Cleveland Heights. “In 2005, the economy started to go in the tank and everybody was preoccupied, I hate to say it, more by survival.”

That effort is being revived.

Earlier this year, the Fund for Our Economic Future released “2 Tomorrows,” a report on the challenges facing the 18-county Northeast Ohio economy. “We are not innovating and investing to the level needed to drive and sustain global competitiveness,” the report stated. “We need to change what we consider success.”

Beyond basic economic concerns, the report focused on the concentration of poverty in the region and on racial inequalities in economic outcomes and challenges to create good jobs and rising incomes across the region.

It also offers a set of measurements to track how well the region is succeeding at meeting those challenges. “What gets measured gets done,” the study argued.

“In ‘2 Tomorrows,’ we put forth what we think is an effective way to measure the economy that looks like the right things,” fund president Brad Whitehead said. “We’ll be doing it quarterly, and it’s an open question whether anyone else will salute it.”

Its measurements look beyond the basic economic metrics and create a “Growth & Opportunity Scorecard” that creates measurements for metrics such as the growth of young businesses, the effort to improve prosperity and how well economic growth is shared across all people in the region.

“We began by thinking, blank slate, what would a successful regional economy look like?” said Peter Truog, director of civic innovation and insight at the fund. He called it an effort to “look at a group of peer cities and see how we stack up.”

Team Northeast Ohio, the regional economic development nonprofit, does gather information on the region’s economy and workforce. While it issues quarterly data to news media, it uses the data primarily to encourage businesses and site selectors considering expanding in the region.

Its president, Bill Koehler, does see the need for greater sharing of the information its researchers gather and would like to see some organization, not his, take a lead role in gathering and sharing that information.

“We need a common place where (this) data resides,” Koehler said. “But even if there is a centralized place where all the data is, we still have to have a common understanding of what the right performance drivers and metrics are, and all of us have to align our strategies around that. It’s not happening enough and people are starting to recognize and challenging those of us in the economic development community to take on the responsibility of doing a better job.”

May Retail Sales Increased 5.6 Percent Over Last Year as Economy Continues to Grow

WASHINGTON–(BUSINESS WIRE)–Jun 14, 2018–May retail sales increased 0.7 percent seasonally adjusted over April and 5.6 percent unadjusted year-over-year as a growing economy prompted consumers to continue to spend, the National Retail Federation said today. The numbers exclude automobiles, gasoline stations and restaurants.

“The economy is looking strong and households have a solid financial foundation on which to base their spending,” NRF Chief Economist Jack Kleinhenz said, noting increased take-home pay thanks in part to tax cuts, unemployment at a long-time low and good availability of consumer credit. “We have seen ongoing momentum over the last several months and believe sales growth should remain healthy and consistent with our 2018 outlook. Nonetheless, inflation and rising oil prices are complicating the picture. And new tariffs or a trade war would certainly be negatives that would increase prices and reduce both consumer purchasing power and consumer confidence.”

The three-month moving average was up 4.6 percent over the same period a year ago, topping NRF’s forecast that 2018 retail sales will grow between 3.8 percent and 4.4 percent over 2017.

The May results build on improvement seen in April, which was up 0.5 percent monthly and 2.8 percent year over year.

NRF’s numbers are based on data from the U.S. Census Bureau, which said overall May sales – including automobiles, gasoline and restaurants – were up 0.8 percent seasonally adjusted from April and up 5.9 percent year-over-year.

Specifics from key retail sectors during May include:

Online and other non-store sales were up 9.1 percent year-over-year and up 0.1 percent over April seasonally adjusted.Clothing and clothing accessory stores were up 8.2 percent year-over-year and up 1.3 percent from April seasonally adjusted.General merchandise stores were up 5.6 percent year-over-year and up 1.2 percent from April seasonally adjusted.Building materials and garden supply stores were up 5.3 percent year-over-year and up 2.4 percent from April seasonally adjusted.Grocery and beverage stores were up 4.4 percent year-over-year and unchanged from April.Furniture and home furnishings stores were up 4.2 percent year-over-year but down 2.4 percent from April seasonally adjusted.Electronics and appliance stores were up 2.8 percent year-over-year and up 0.2 percent from April seasonally adjusted.Health and personal care stores were up 2.6 percent year-over-year and up 0.5 percent from April seasonally adjusted.Sporting goods stores were down 0.5 percent year-over-year and down 1.1 percent from April seasonally adjusted.

About NRF

NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private-sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF.com

Retail and real estate column: Buyer demand creates sizzling housing market

 

The median sales price for a home in northeast Indiana was up 8.9 percent in May from the same month a year earlier, according to a new report from the Upstate Alliance of Realtors Multiple Listing Service.

Inventory levels shrank 17.8 percent and the percentage of original sales price received by sellers was up 1.2 percent, to 97.9 percent. New listings increased 10 percent.

“The intensity of buyer demand is unlike anything we’ve seen in recent history, said Kim Ward, 2018 UPSTAR MLS president. “Now that we’re in the spring selling season, I’m glad to see that new listings have increased to help accommodate the demand and competition for desirable homes.”

For the year to date through May, the median sales price is up 6.2 percent and inventories are down 8.4 percent for the same period in 2017.

UPSTAR’s primary coverage area includes the counties of Adams, Allen, DeKalb, Huntington, Noble, Wells and Whitley.

SVN Parke Group

Brandon Downey represented both the lessee, Tonn and Blank Construction LLC, and the lessor, Leo #1 LLC, in the lease of 4,200 square feet of industrial space at 6016 Highview Drive, Units 4 & 5.

Downey represented both the lessee, Mike Lee, and the lessor, Rose Ann Turner and Rose Ann Turner Trustees, in the lease of 4,500 square feet of industrial space at 5015 Speedway Drive, Unit D.

Downey represented the lessor, Barry Knoll LLC, and the lessees in the following lease transactions: First Community Care LLC in the renewal of a lease of 4,800 square feet of industrial space at 3404 Metro Drive, Suites B & D; David Wall in the new lease of 5,400 square feet of industrial space at 6015 Highview Drive, Unit A; and Tech Solutions Corp. in the new lease of 1,800 square feet of industrial space located at 6015 Highview Drive, Unit C.

Diana Parent represented the seller, Texas Roadhouse Holdings LLC, and Jim Lohman represented the buyer, RU Twins LLC, in the sale of the property at 620 W. Washington Center Road.

Bill Beard represented both the seller, Anne Pape, and the buyer, Andrew Stores, in the sale of 1,744 square feet of office space at 3450 Stellhorn Drive.

Bradley Co.

Tyler Binkley represented the tenant, Georgetown Professional Center LLC, and the tenant, JB’s Barber Shop, in the lease of retail space in Georgetown North, 6424 Georgetown North Blvd.

Kienan O’Rourke represented the tenant, GAI Consultants, in the lease of 6,239 square feet of office space at 9921 Dupont Circle Drive West.

CBRE/Sturges

John Caffray represented the seller, Beedy Properties LLC, in the sale of a 20,748 square-foot industrial building at 2403 Shoaff Road, Huntertown.

Caffray represented the lessee, Forefront Management LLC, in the lease of 1,549 square feet of office space at 2250 North Pointe Drive, Warsaw.

Neal Bowman and Rebecca Worrell represented the tenant, Dish Network Services LLC, in the renewal of a lease of 9,328 square feet of space at 3230 Rosetta Place, South Bend.

Bowman and Worrell represented the landlord, Chapel Ridge LLC,and also represented the tenant, AZFIT LLC, doing business as 9Round, in the lease of 1,280 square feet of space at 10454 Maysville Road. This is 9Round’s third Fort Wayne location.

Retail sales top forecast

May retail sales increased 0.7 percent seasonally adjusted over April and 5.6 percent unadjusted year-over-year as a growing economy prompted consumers to continue to spend, the National Retail Federation reported.

The numbers exclude automobiles, gasoline stations and restaurants.

“The economy is looking strong and households have a solid financial foundation on which to base their spending,” NRF Chief Economist Jack Kleinhenz said in a June 14 release. “We have seen ongoing momentum over the last several months and believe sales growth should remain healthy and consistent with our 2018 outlook. Nonetheless, inflation and rising oil prices are complicating the picture. And new tariffs or a trade war would certainly be negatives that would increase prices and reduce both consumer purchasing power and consumer confidence.”

The three-month moving average was up 4.6 percent over the same period a year ago, topping NRF’s forecast that 2018 retail sales would grow between 3.8 percent and 4.4 percent over 2017.

  • Greater Fort Wayne Business

Retail Sales Figures

Retail-sales figures

WASHINGTON

Nonseasonally-adjusted May retail sales increased 5.6 percent year-over-year and seasonally adjusted sales increased 0.7 percent over April, the National Retail Federation announced.

“The economy is looking strong and households have a solid financial foundation on which to base their spending,” said NRF Chief Economist Jack Kleinhenz.

He noted increased take-home pay due in part to tax cuts, low unemployment, and high availability of consumer credit as factors.

“We have seen ongoing momentum over the last several months and believe sales growth should remain health and consistent with our 2018 outlook,” he said. “Nonetheless, inflation and rising oil prices are complicating the picture. And new tariffs or a trade war would certainly be negatives that would increase prices and reduce both consumer purchasing power and consumer confidence.”

Staff/wire reports

Youngstown Vindicator

2017 Crystal Ball Award Winners

For the majority of U.S. households, residential real estate is the single-largest asset on the balance sheet. Prevailing home equity levels–and expected home value changes–can have out-sized influence on consumer spending and behavior (i.e., wealth effects). As an asset class, U.S. housing has an aggregate value of almost $30 trillion. For these and other reasons, the home value expectations of experts bear watching, and forecasters with the most outstanding performance deserve recognition.

In every year since 2010, Pulsenomics has recognized the most accurate and reliable forecasters of U.S. home values with a Crystal Ball Award. More than 100 experts who participate on our panel vie for the honor in a variety of award categories by predicting the future path of the Zillow Home Value Index.

This year, Jack Kleinhenz (pictured), who heads Kleinhenz & Associates and also serves as chief economist of The National Retail Federation, earned first-place in two prize categories, including one that is arguably the most challenging: the five-year horizon. Jack won this prize in an especially impressive fashion. The actual cumulative change in U.S. home prices for the five-year period ended Dec. 2017 was 32.9%; back in 2013, Jack predicted prices would increase 32.8% over that period. That’s not a typo. Drop the mic, Jack!

Pulsenomics’ Top Ten panelist rankings include details of forecast accuracy in each of 11 categories. Please join me in congratulating all of our 2017 honorees!