MW: Retail sales slump again, as Americans pocket savings at pump
WASHINGTON (MarketWatch) — Retail sales fell in January for the second month in a row as drivers spent a lot less on gasoline and didn’t appear to use that savings elsewhere.
Retail sales declined by a seasonally adjusted 0.8% last month after a 0.9% drop in December, the government said Thursday.
Sales at gas stations slumped 9.3% to mark the biggest pullback since 2008, reflecting a plunge in oil prices that’s reduced the price at the pump to less than $2 a gallon in some parts of the country.
Yet retail sales excluding gas were still flat compared to December, a sign that consumers aren’t using their fuel savings to spend more on other goods and services. Instead they appear to be saving more.
Sales fell at auto dealers, home-furnishing stores, grocery chains, department stores, apparel retailers and outlets that sell sporting goods, the Commerce Department said.
Internet stores and restaurants, two of the largest retail categories, were among the few sectors to boost sales. Online sellers increased sales by 0.5%, and restaurants saw a 0.8% gain.
Over the past year spending at restaurants has climbed 11.3%, a good sign that reflects growing consumer confidence in the health of the U.S. economy. People go out less when they are feeling down.
Even though they are more confident, though, consumers continue to mind their money. The biggest increase in hiring in 2014 in 15 years and sharply lower gasoline prices still aren’t enticing Americans to boost how much they spend — a necessary shift to push the economy to greater heights.
One reason: wages haven’t risen very much. Average hourly wages have risen just 2.2% in the past year, about two-thirds as fast as they normally do when the economy is humming.
