Local Market Monitor (a National REIA preferred vendor) recently released their National Economic Outlook for July, 2017 where they share their thoughts on developments taking place in the U.S. economy.
National Economic Outlook – July 2017
July 19, 2017
By: Ingo WinzerJobs in retail sales were flat again in June. What’s going on here? I’ve been harping on this for a few months but the picture still isn’t clear. Is the lack of growth in retail jobs an indicator that growth is slowing down? Or does it just mean that we’re buying more stuff on-line?
In dollars, retail sales (including on-line) increased 4 percent in 2014, 3 percent in 2015, 3 percent in 2016, and 4 percent so far this year. So, there isn’t a downward trend in spending, at least not in the past few years,. But this IS slower spending than the 5 and 6 percent increases we used to have. What we’re probably seeing is a combination – more internet sales, but also a SHIFT in spending, mainly by people whose income has been flat. Consider that 40 percent of renters pay more than a third of their income for housing, and a bunch of the rest now goes for phone and internet service.
All of this doesn’t completely answer our question, because the lack of new jobs in retail – the lowest paying part of the economy – isn’t being made up elsewhere. While internet sales did increase, we’re ALSO seeing a slowing of overall growth. Jobs in June overall were up 1.5 percent from last year – flat in manufacturing, retail and government, but up 3 percent in business services, 2 percent in healthcare, and 2 percent at restaurants.
About the Author: Ingo Winzer is President of Local Market Monitor, and has analyzed real estate markets for more than 20 years. His views on real estate markets are often quoted in the national press and in 2005, he warned that many housing markets were dangerously over-priced. Previously, Ingo was a founder and Executive Vice President of First Research, an industry research company that was acquired by Dun and Bradstreet in March 2007. He is a graduate of MIT and holds an MBA in Finance from Boston University. He resides in Cambridge, Massachusetts.
www.LocalMarketMonitor.com
[email protected]
Ph 800-881-8653
