Americans cut back on their spending last month as a surge in COVID-19 cases kept people away from stores.
Retail sales fell a seasonal adjusted 1.1% in July from the month before, the U.S. Commerce Department said Tuesday. It was a much larger drop than the 0.3% decline Wall Street analysts had expected.
The report offers the first solid glimpse of how the spread of the delta variant of COVID-19 may have changed the spending habits of Americans. At the end of July, the U.S. Centers for Disease Control and Prevention began recommending that even vaccinated people start wearing masks indoors in public places.
According to Tuesday's report, spending fell at stores that sell clothing, furniture and sporting goods. At restaurant and bars, spending still rose nearly 2%, but the rate of growth has slowed from recent months before the delta variant spread and people were feeling safer about dining without their masks with others.
Economists think Americans are also shifting their spending from goods to services, things like haircuts or vacations, which are not included in Tuesday’s report. And rising prices for everything from food to washing machines may have checked spending.
Major retailers are releasing quarterly financial results this week, offering more insight into behavior during yet another uptick in infections. On Tuesday, Walmart raised its sales outlook for the year, a sign it expects Americans to keep on shopping at the same pace.
But the Commerce Department reported Tuesday that even online sales have begun to slow, falling 3.1% from the month before. Companies have reported a slowdown after astronomical growth last year as people stayed home and shopped more online during the pandemic.
Ebay, for example, said its number of active shoppers slipped 2% to 159 million in its latest quarter. UPS said it's shipping fewer packages in the U.S. And Amazon, the world's largest online retailer, said online sales grew 13% in its most recent quarter, the company’s smallest quarterly online sales growth in two years.
On this episode of On The Job presented by ADP: Gemma Burgess, CEO of Ferguson Partners, explains what people are looking for in an employer, and how to convey positive work culture to potential employees; Amy Leschke-Kahle, Vice President of Performance Acceleration at The Marcus Buckingham Company, an ADP company, breaks down how encouraging employee engagement and empowering employee voices can benefit every workplace and busts a myth about employee engagement while working from home; Jim Huether, CEO of Hyperice, discusses Hyperice's new employee mental health initiative, known as the Workplace Alliance, with 100-plus companies to combat the ongoing mental health crisis and how they're taking a hands-on, data-driven approach to the mental health crisis.
Amy Leschke-Kahle, Vice President of Performance Acceleration at The Marcus Buckingham Company, an ADP company, joins Cheddar to discuss how encouraging employee engagement and empowering employee voices can benefit every workplace and busts a myth about employee engagement while working from home.
Jim Huether, CEO of Hyperice, joins Cheddar to discuss Hyperice's new employee mental health initiative, known as the Workplace Alliance, with 100-plus companies to combat the ongoing mental health crisis and how they're taking a hands-on, data-driven approach to the mental health crisis.
Consumer prices saw an 8.6 percent jump in May, with fuel prices showing the biggest surge, climbing 17 percent last month. As inflation continues to climb to levels not seen in 40 years, President Biden took to calling out ExxonMobil and other major oil companies, accusing them of holding back production while continuing to collect huge profits at the cost of the consumer. Mark Avallone, the president of Potomac Wealth Advisors, joined Cheddar's Opening Bell to discuss. “They have reduced long-term expenditures. But why? Because the world is going to alternative energy and as consumers, if we thought that that welcome change to alternatives was going to happen without pain, we might have been mistaken," he said. "The less investment they make in oil because they're getting ready for a new world of electric vehicles, the less we're going to be prepared for oil shocks such as the one we got when Russia invaded Ukraine."
Catching you up on the stories you need to know this morning, the U.S. could soon get its first major gun safety law in years, the House Select Committee investigating the January 6th attack on the U.S. capitol holds its second hearing, and today might just be the day the Supreme Court overturns Roe v. Wade, and decides on new gun laws.
