Although factors such as the upcoming presidential election, the current trade war and increasing worries about the spread of the coronavirus have cast uncertainty over the outlook of retail sales, the National Retail Federation’s 2020 forecast predicts healthy growth in the industry again this year.
Indeed, the NRF forecasts industry growth between 3.5% and 4.1% this year, which would equate to retail sales of between $3.93 trillion and $3.95 trillion. These numbers do not include automobile dealers, gasoline stations and restaurants.
Low unemployment rates in the US (currently at 3.6%), as well as low interest rates and low inflation, have contributed to the optimistic forecast. This is despite the fear of the coronavirus becoming a global pandemic as well as the impact more factories shutting down in China could have on the delivery of holiday season merchandise.
Online sales are expected to grow between 12% and 15% this year, representing a total between $870.6 billion and $893.9 billion, which is included in the overall forecast figures.
The level of expected growth this year is slightly less bullish than the NRF’s prediction of 3.8-4.4% for 2019 (it also predicted the same level of growth in 2018). For now, the NRF believes that actual growth in 2019 may have just missed that mark, noting that its preliminary estimate for 2019 is for total retail sales growth of 3.7% (to $3.79 trillion in sales).