US Retail Sales Jump in January as Economy Looks Toward Recovery in 2021

By Thomas Price Thursday, February 18, 2021

Economic recovery looks to finally be taking hold in the United States (US) as retail sales in January took a jump following a disappointing final few months that closed out 2020. The boost in retail sales comes after tentative reopenings of businesses across the nation as the COVID-19 vaccine rollout continues to ramp up along with the $600 stimulus check being used by citizens as well. Businesses and companies of all sorts saw a major lift in January, though the biggest gains were made in the housing and furnishing business and companies in the hobby and sporting goods market.

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Retail Sales Numbers in January

After retail sales declined in every month during the final quarter of the fiscal year in 2020, 2021 started with a bang as January saw a 5.3% increase. The jump in sales also marked a major increase from expert projections that expected the month to only see a 1.2% growth. January’s retail sales spike was also the largest to take place since June of 2020, when many businesses had reopened following the first round of lockdowns being lifted across the majority of states.

The January lifted sales comes off the back of the $900 billion stimulus package that included a second stimulus check for American citizens worth $600 and $300 worth of additional unemployment benefits.

Nearly all different business types benefitted from the sales spike outside of the auto companies. The biggest winners of the month were companies in the electronics and appliance sector, garnering a 14.7% increase in sales. Home and furnishings businesses also grew above the total retail gain, seeing a 12% increase.

Other big winners were companies selling hobby and sporting goods, rising in sales by 8%. One of the bigger surprises of the report came from companies in the restaurant and food industry seeing a 6.9% growth, pointing to recovery as indoor dining opens to the public again.

Future Outlooks on Retail Sales

Retail sales are primed to rebound even more in the coming months as vaccine rollout and distribution is fueling business reopenings across the nation. These gains could be made even larger if the proposed $1.9 trillion stimulus package is approved, providing another round of checks to Americans. While the momentum may start off slow, economists predict that by the end of Q1 and through the rest of the year, barring any major shifts in current trends, business and companies in all industries should experience major economic gain.

When commenting on the January gains alongside the future of the companies in retail fields, UBS Analyst Michael Lasser said, “It's an uncertain time in retail. Walmart and other retailers did quite well in 2020. How they navigate the other side of this as we get back to normal and reopened and consumers go travel and go out to eat will be important.”

About the Author

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Tom Price is a writer focusing on entertainment and sports features. He has a degree from NYU in English with a minor in Creative Writing. He has been previously published for Washington Square News, Dignitas, CBR, and Numbers on the Boards.

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