For Immediate Release
February 26, 2003

LANSING — Michigan retailers expect to increase sales by nearly 6 percent this year, a marked improvement from virtually no growth last year, according to the Michigan Retail Index, a joint project of the Michigan Retailers Association (MRA) and Federal Reserve Bank of Chicago.

The Index, based on a monthly survey of MRA members, found that stores’ sales grew by an average of 0.8 percent in 2002. Looking ahead, retailers project annual increases averaging 5.7 percent in 2003.

The optimism follows a slight uptick in January sales during a continued cold retail climate. Twenty-nine percent of retailers increased sales from the same month a year ago, while 59 percent experienced declines and 12 percent reported no change. The results create a seasonally adjusted performance index of 35.6, up from 33.1 in December.

For the February-April period, 44 percent expect to increase sales from the same period last year, while 32 percent forecast declines and 24 percent project flat sales. The results create a seasonally adjusted outlook index of 60.5, down from 61.2 in December.

"The retail climate continues to be a difficult one because of economic uncertainty, the threat of war in Iraq and higher gasoline prices. But most retailers expect sales to recover and to post solid, but not spectacular, gains by the end of the year," said Larry Meyer, MRA chairman and CEO.

The Michigan Retailers Association is the unified voice of retailing in Michigan and the nation’s largest state trade association of general merchandise retailers. MRA’s more than 5,800 retail business members operate more than 13,000 stores across the state.

Note: William Strauss, Senior Economist and Economic Advisor with the Federal Reserve Bank of Chicago, can be reached at 312.322.8151.