NEW YORK – Americans’ spending – much like the economy – continues to yo-yo.
Major retailers such as Costco and Macy’s reported on Thursday that April revenue rose less than 1 percent in the worst performance since 2009, when the U.S. economy was just coming out of a bad recession.
The disappointing results follow two consecutive months of strong sales that were boosted by positive economic news about the job and housing markets.
“The economy is growing in fits and starts, and we are seeing sales shoot up and down,” said Michael P. Niemira, chief economist at the International Council of Shopping Centers. “We’re in a choppy period.”
A small group of merchants representing roughly 13 percent of the $2.4 trillion U.S. retail industry report monthly revenue at stores open at least a year, a key measure since it excludes results from locations that open and close during the year. Still, the figures offer a snapshot of consumer spending, which accounts for more than 70 percent of economic activity. And recently, it’s shown that Americans’ spending sways with the waves of economic news.
An average of April’s results for 22 retailers nationwide rose 0.6 percent – the worst since November 2009, when the tally was down 0.2 percent, according to the International Council of Shopping Centers. The recession officially ended in June 2009. That’s in stark contrast to February and March, when the group posted an average 4.1 percent sales gain on signs the economy was improving.
The latest results are impacted by a flurry of negative economic news. Government reports on jobs and housing in recent weeks have renewed concerns that the economic recovery is facing a spring slowdown for the third straight year. And the stock market rally also has lost some steam amid worries about the European financial crisis and the economy at home.
Other factors also helped dampen sales. For instance, analysts believe an earlier Easter, which was on April 8 and occurred 16 days earlier than last year, pushed sales out of April into March. Retailers blame a late Mother’s Day for pushing some sales out of April and into May. And an unusually warm February and March pulled forward some sales that would have normally occurred in April.
Macy’s Inc., which runs Bloomingdale’s in addition to its namesake stores, said that it expected its April sales to be softer than in March in part because of the earlier Easter. It also said its results were impacted by a move of a cosmetics event in its stores to March from April.
As a result, Macy’s posted a 1.2 percent increase in April revenue at stores open at least a year, missing the 1.9 percent rise predicted by analysts polled by Thomson Reuters.
Others posted disappointing results, too. Costco Wholesale Corp. said its revenue from stores open at least a year rose 4 percent in April, below the analysts’ estimate of a 5.1 percent increase from the wholesale club operator. Meanwhile, Target Corp. said its sales rose 1.1 percent in April, missing the 2.8 percent increase analysts had expected.
Not everyone posted worst-than-expected figures. TJX Cos., which runs Marshalls, T.J. Maxx and HomeGoods, reported that revenue at stores open at least a year rose 6 percent in April, topping Wall Street’s forecast of a 4 percent rise. The company also boosted its first-quarter and fiscal 2013 earnings outlooks.