Record high inflation hasn’t put a damper on consumer spending.
The U.S. Census Bureau reported today that retail and food service sales in February 2022 totaled $658.1 billion, marking a seasonally adjusted 0.3% increase from the previous month and a 17.6% leap from February 2021.
The Bureau also amended its number for January sales to represent a sales total of $656.1 billion, or a 4.9% increase from December.
This growth in spending came as inflation continues to climb to record levels. Consumer prices rose by 7.9% in February compared with a year ago, according to the Bureau of Labor Statistics’ monthly report. This number was up from the 7.5% growth in January and represented the highest inflation rate since the 12-month period ending in January 1982.
Between December 2021 and February 2022, total retail and food services sales were up 16% compared to the year before.
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Specifically, February sales from retail rose 0.4% from the prior month and 15.9% year-over-year. Compared to last year, clothing and accessories sales grew 30.6%, Gasoline stations sales were up 36.4%, food services and drinking sales were up 33%, and department stores sales grew 22.8%.
The strong sales numbers in February were partially affected by the rising costs of goods across all sectors. But results were still encouraging.
“At both an overall and a category level, the current picture is far from gloomy,” said managing director of GlobalData Neil Saunders in a statement. “However, we remain cautious. As we move into March, retail comes up against some very tough prior year comparatives.”
As such, Saunders anticipates retail sales to start normalizing throughout 2022, in line with similar projections from other retail data groups.
The National Retail Federation (NRF) announced on Tuesday that it expects retail sales to grow between 6% and 8% to more than $4.86 trillion in 2022. This would mark a slowdown from the 14% growth in 2021, which represented the highest growth rate in over 20 years, but still sit above the pre-pandemic growth rate.
“NRF expects retail sales to increase in 2022, as consumers are ready to spend and have the resources to do so,” said NRF president and CEO Matthew Shay. “We should see durable growth this year given consumer confidence to continue this expansion, notwithstanding risks related to inflation, COVID-19 and geopolitical threats.”
Following a year of record growth in 2021, footwear sales are also projected to level out.
The NPD Group said it expects footwear sales to continue to rise through 2024, though at a slower rate than 2021. The American footwear industry broke annual records in 2021 at over $100 billion reached in total spending, according to data from the Footwear Distributers and Retailers of America (FDRA). Overall, footwear revenues grew 23% in 2021 over 2020, with unit sales also increasing in the double digits.
