Encouraging but cautious signs with December retail numbers
While I endeavor to be an optimist when it comes to the economy, it is hard for me not to scratch my head when looking at reports about what is actually happening. This line of thinking stems from perusing some items on December retail sales. When looking at these items, I needed to remind myself that the numbers for same store sales for December were all very consistent, regardless of the source.
in the NewsState of Logistics 2016: Pursue mutual benefit Medical device manufacturer uses automation and shelving to improve its working environment Device improves ergonomics on the pick floor for Capital Candy American Plumbing & Heating’s new mezzanine improves workers’ safety Multi-level mezzanine system provides superior strength and stability More News
While I endeavor to be an optimist when it comes to the economy, it is hard for me not to scratch my head when looking at reports about what is actually happening.
This line of thinking stems from perusing some items on December retail sales. When looking at these items, I needed to remind myself that the numbers for same store sales for December were all very consistent, regardless of the source.
The International Council of Shopping Centers (ICSC) reported that December same store sales, excluding Wal-mart, were up 3.1 percent. And a Thomson Reuters survey of 28 retailers also reported a 3.1 percent gain in December.
That sounds about right, given the talk about increased consumer confidence and six months of increased retail sales, according to the National Retail Federation and the U.S. Department of Commerce.
But here is where things get a little blurry.
A New York Times report noted that the Thomson Reuters numbers missed expectations, with analysts calling for a 3.4 percent December hike, which was “buoyed by reports of rising foot traffic, online spending and early holiday sales.” But the report did state that the overall holiday season was still relatively strong, especially when taking November’s 6 percent hike into consideration.
Another interesting data point from the ICSC is that for the November-December holiday period same store sales were up 3.8 percent annually for the largest holiday increase since 2006.
Meanwhile, the AP is reporting that the momentum shoppers had during the holiday season is likely to continue. This is where things get a little confusing.
Make no mistake, the holiday retail performance was solid, especially when compared to 2009. But last I checked, unemployment is still too high and gas seems to be getting more expensive every time I go to the pump.
That said, I am personally a little skeptical about what is going to happen this year. While there are some positive signs, there are an equal amount of warning signs, it seems.
But here is the thing: the signs of optimism are coming from sources and people that are far more knowledgeable on this than yours truly.
Look no further than Mark Zandi, chief economist at Moody’s Analytics. Zandi told the AP that consumer spending will rise 3.6 percent in 2011—or double 2010’s growth rate. And this pace would put the economy on a 4 percent trajectory, up from Zandi’s 2010 2.8 percent estimate.
Wait, there is more.
Zandi said that this stronger growth should lead to companies adding 2.9 million jobs this year, up from the 1.1 million jobs projected for 2010, dropping the unemployment rate to 9 percent for 2011 and down from 2010’s 9.5 percent.
OK—now I am coming around to the optimistic side of the fence. If these numbers come in at anything close to this, it means good news for all of us.
For carriers it means more volumes and for shippers it might translate into some rate relief early in this New Year. But anyway you look at it, one should hopefully be cautiously optimistic about where these numbers are heading.
Things can change in a hurry, but I am going to do my best to stay on the positivity train while it is still rolling.
About the AuthorJeff Berman, Group News Editor Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman
Subscribe to Logistics Management Magazine!Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!
European Logistics Update: Post-Brexit U.K. moving ahead, but in which direction? Badcock Home Furniture &more: Out with paper, in with Cloud TMS View More From this Issue