Michigan retailers’ May sales, forecasts jump

Michigan retailers’ sales and forecasts jumped to their highest levels of the year in May, according to the Michigan Retail Index, a joint project of Michigan Retailers Association (MRA) and the Federal Reserve Bank of Chicago.

The solid upturn was a sharp contrast to April’s dismal figures.

“Warmer weather and consumers rebounding from their April pullback sparked retailers’ sales and optimism,” said Larry Meyer, MRA chairman and CEO.

“Those factors plus a drop in Michigan’s unemployment rate offset a continued rise in gasoline prices.”

The Michigan Retail Index showed that 47 percent of retailers increased sales in May over the same month last year, while 32 percent recorded declines and 19 percent saw no change. The results create a seasonally adjusted performance index of 54.1, up from 39.7 in April and the highest since January 2006. It was also the best May since 2000.

Index values above 50 generally indicate an increase in activity for the overall industry, while values below 50 indicate a decrease.

In addition, 46 percent believe their sales will increase for June–August, while 22 percent forecast declines and 30 percent project no change. The results create a seasonally adjusted outlook index of 59.1, up from 49.8 in April and the highest since December 2006.

Northern Michigan retailers led the state, with 56 percent boosting sales and 24 percent falling behind last year. Southeast Michigan retailers followed, with 52 percent reporting increases and 30 percent decreases.

Sales tax collections totaled $512.1 million in May, which was down 14.6 percent from last year’s level. Most of this decline was due to noneconomic fluctuations in monthly tax collections, as April sales tax collections were up 22.6 percent.

After adjusting for these timing fluctuations using a three-month moving average, sales tax collections were down 2.2 percent for the three months ending in May.

Complete results of this month’s Michigan Retail Index—including data on sales, inventory, prices, promotions and hiring—are available at www.retailers.com/news/retailindex.html. The website includes figures dating back to July 1994.

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