NRF Holds State of Retail and Consumer Event, Announces Annual Sales Forecast
The National Retail Federation held its second annual State of Retail & the Consumer virtual event on March 15, which explored the American consumer and key behavior trends that developed during the pandemic and its aftermath.
The virtual conference featured industry experts, retail CEOs and market researchers who discussed the current climate of the retail market. Key takeaways were:
• pent-up demand will continue to drive and keep spending steady as people are venturing out again,
• retailers’ ability to offer solutions to customers in a flexible manner will be a definition of success, and
• how the role of aspirational independents as a group is growing in influence and purchasing power
The NRF also released its annual forecast and predicts retail sales will grow between 6 percent and 8 percent to more than $4.86 trillion this year. Non-store and online sales year-over-year are expected to grow between 11 percent and 13 percent as customers continue to utilize e-commerce. The 2022 number is a drop from the 14 percent annual growth rate in 2021, the highest growth rate recorded in over 20 years. This year’s forecast is above the 10-year, pre-pandemic growth rate of 3.7 percent.
“The NRF expects retail sales to increase in 2022 as consumers are ready to spend and have the resources to do so,” NRF President and CEO Matthew Shay said. “We should see durable growth this year given consumer confidence to continue this expansion, notwithstanding risks related to inflation, COVID-19 and geopolitical threats.”
Retail sales are expected to remain strong as the economy continues to open further from the lift in pandemic restrictions. The NRF continues to anticipate job and wage growth while unemployment continues to decline. NRF Chief Economist Jack Kleinhenz said more incoming data is expected in the next few months, and there are other uncertainties that the NRF will continue to monitor.
“Most households have never experienced anything like this level of inflation, and it is expected to remain elevated well into 2023,” Kleinhenz said. “In addition to inflation, the forces impacting the economy include COVID-19 impacts, international tensions and policy variability.”