LANSING, Mich. – Michigan retailers saw another month of increased sales as stores’ doors remain open, but with certain restrictions in place, such as half capacity seating limits and face mask orders.
The July Retail Index survey came in at 60.0, an increase from June’s 53.5. The seasonally adjusted performance index is conducted by Michigan Retailers Association (MRA) in cooperation with the Federal Reserve Bank of Chicago’s Detroit branch.
For many retailers across the state, July was the first full month of sales since COVID-19 and government restrictions closed their doors in early spring.
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.
The July survey showed that 64% recorded increases over June. Thirty-three percent of respondents reported sales declines and 3% reported no change.
Retailers are predicting their three-month outlooks to be slightly better than July. Fifty-four percent predict they’ll continue to rise in the next three months, but 23% said they expect a sales decline, and 23% don’t think things will change. That results in a 65.4 Index rating.
“We’re happy that several retailers reported being busy after such a dismal spring,” said Bill Hallan, President and CEO of Michigan Retailers Association. “It’s partly due to back-to-school sales, but also, very few cases of COVID-19 have been tied to shopping, so retail has proven that it can operate safely during the pandemic by following established protocols.”
Sales tax receipts in July 2020 reached an all-time monthly record. The collections totaled $867.2 million, 18.5% above the July 2019 level and $202.8 million above the forecast. Michigan’s unemployment rate preliminarily dropped again to 8.7% from June 2020’s 14.8%. Last year, Michigan’s unemployment rate was 4.1%. In July 2020, the national unemployment rate dropped a few ticks to 10.2%.
Nationally, the U.S. Census Bureau reported overall retail sales during July were up 1.2 percent seasonally adjusted from June and up 2.7 percent year-over-year. That follows an 8.4 percent month-over-month increase in June. Retail sales have been climbing after a record monthly drop while most stores were closed in April, the National Retail Federation said.
Note: Paul Traub with the Federal Reserve Bank of Chicago, can be reached at 313.964.6297.