Retailers report a slightly slower start to 2022
than reported in 2021
Michigan Retailers Association today reports January 2022 sales fall from robust December 2021.
The January Retail Index survey came in at 58.3, a decrease from December’s 77.7. Thirty-one percent (31%) of Michigan retailers reported a sales increase over December; 46% noted a decrease, and 23% reported no change.
The seasonally adjusted performance Index is conducted by Michigan Retailers Association (MRA) in cooperation with the Federal Reserve Bank of Chicago’s Detroit branch.
The 100-point Index provides a snapshot of the state’s overall retail industry. Index values above 50 generally indicate positive activity; the higher the number, the stronger the activity.
Sixty-one percent (61%) of retailers predict their sales will continue to rise through April, but 13% said they expect their sales to decline. Twenty-six percent (26%) anticipate no change. That results in a 64.8 Index rating, a decrease over last month’s prediction Index rating of 72.3, but still an indication of positive activity.
“Following a record holiday season, it’s not abnormal to see a dip in sales,” said William J. Hallan, President and CEO of the Michigan Retailers Association. “Sales have a seasonal swing and typically the start of the year reflects it.”
Concerns Over Costs
Some survey respondents raise concerns over increasing product costs, supply issues, and rising wages. One retailer said they spend more time than ever tracking down deliveries and searching for alternative sources. Another said some of their product from suppliers won’t be expected until 2023 or 2024.
“With the current challenges retailers face, and adding cold temperatures and snowstorms into that mix, retailers are looking forward to spring. Their optimism remains high,” said Hallan.
Michigan’s unemployment rate in January has yet to be announced. In December 2021, the unemployment rate in Michigan preliminarily came in at 5.6%, down from November’s 5.9%. In December 2020, Michigan’s unemployment rate was 8.2%. In January 2022, the national unemployment rate rose slightly to 4.0%, compared to December’s 3.9%. Last year, the national unemployment rate was 6.4%.