Retail Index 3-Month Optimism Climbs

Michigan Retailers Association reports that August 2025’s Retail Index came in at 44.9, down nearly five points from July’s 49.8, remaining below the 50-point threshold for three consecutive months.

The 100-point Index provides a snapshot of the state’s overall retail industry. With higher numbers indicating stronger activity, index values above 50 generally indicate positive sales activity. The seasonally-adjusted performance index is conducted by Michigan Retailers Association (MRA) in cooperation with the Federal Reserve Bank of Chicago’s Detroit branch.

This seasonally-adjusted index indicates how current retail sales compare to a historical average for each month. Thirty-four percent of retailers noted an increase in August sales over July, while 47% of Michigan retailers surveyed reported a sales decrease, and 19% reported no change. 

“The past three months have consistently shown a decline in sales for Retailers across Michigan,” said William J. Hallan, President and CEO of the Michigan Retailers Association. “As we approach the holiday shopping season, it’s important for consumers to keep their money in Michigan and shop local first. Our retailers are still feeling the impacts of a volatile year, and holiday sales will be critical for local businesses.”

3-Month Outlook
When asked about their sales outlook for the next three months (September through November 2025), 58% of retailers predicted their sales would increase, 16% said they expect their sales to decline, and 26% anticipate no change. That results in an index rating of 75.7 for the 3-month outlook, a notable increase from July 2025’s 68.1 score, and a good sign as retailers head into fall. August 2025’s outlook score is the highest outlook score since 2023.

“This record-high 3-month outlook for this year reflects renewed excitement and optimism among retailers across the state,” Hallan shared. “We’re just weeks away from October, which marks the start of holiday shopping for many consumers, especially shoppers looking to spread their gift-buying out over several pay periods. Inventory numbers are climbing, too, and retailers are ready for a busy holiday season to close the year out strong.”

The inventory outlook for the next three months rose again to 61.1, the highest the score has been in 2025. This increase follows two months of notable volatility, with the score rebounding to 58.4 in July after this year’s low of 47.6 in June. 

Buy Nearby Weekend Approaches
Buy Nearby Weekend, coming up on Oct. 3-5, 2025, is Michigan Retailers Association’s annual celebration of Michigan-based retailers and small businesses. This year’s celebration will include a road trip across the state with the Buy Nearby Guy, Michigan’s favorite big blue mascot, visiting retailers in multiple Michigan cities. 

During Buy Nearby Weekend, consumers are encouraged to shop with Michigan-owned retailers as they kick off their holiday shopping for a chance to win a $500 gift card in the “Shop 3 Challenge Punch Card Contest.” Retailers can participate in a Buy Nearby Weekend Display contest for a chance to win a $500 gift card or a 1-year MRA membership for their business. More information on both contests can be found at BuyNearbyMI.com 

The 2025 Buy Nearby Economic Impact Study, performed by Public Sector Consultants, found that shifting just 10% of Michiganders’ online shopping to a Michigan Business would create over 11,900 jobs and boost Michigan’s labor income by $557 million. Buy Nearby Weekend emphasizes the importance and impact of shopping small and supporting Michigan-based retail.

Unemployment Rates
Michigan’s August unemployment rate has yet to be announced; however, July’s 2025 unemployment rate has been preliminarily reported at 5.3%. Last August, the state’s unemployment rate came in at 5.0%. The national unemployment rate in August rose one notch to 4.3%, compared to July’s 4.2%. Last year, the national unemployment rate was 4.2%.