Volume 2, Issue 5 – March 15th, 2014
The National Retail Federation estimates that retail sales (excluding automobiles, gas stations, and restaurants) will increase 4.1%, this year up from the preliminary report of 3.7% growth in 2013.
NRF also said that it expects online sales in 2014 to jump anywhere between 9 and 12%.
“Measured improvements in economic growth combined with positive expectations for continued consumer spending will put the retail industry in a relatively good place in 2014,” said NRF President Matthew Shay.
While increased health care costs and regulatory concerns pose risks for consumers and retailers, Shay is cautiously optimistic about the economy.
“As the industry tackles important issues in 2014, such as immigration and tax reform, we will continue to push our nation’s leaders to support policies that promote growth and create jobs for hard-working Americans,” he said.
NRF expects economic growth will be above its long-term historical average. Early estimates for GDP growth could fall between 2.6 and 3%, an improvement from the estimated 1.9% rate for 2013, and the fastest pace in the past three years.
The labor market is expected to continue its modest recovery, averaging approximately 185,000 jobs per month, and inflation is predicted to inch higher to as much as 1.7% in 2014. The housing sector also is expected to continue to improve in 2014, along with consumer and business confidence.
NRF also warned against the nationwide movement by politicians to raise minimum wages. “National policy should be focused on removing barriers to job creation, not creating new regulations or mandates. It’s simple math – if the cost of hiring goes up, hiring goes down,” Shay said.
“A mandated hike in labor costs would negatively impact businesses that employ people in entry-level jobs and ultimately hurt the people it is intended to help,” he added. “This isn’t economic theory – when the minimum wage went up in 2009, half a million part-time workers lost their jobs. That’s a risk our economy can’t afford to take.”