The reports on Wednesday came as millions of Americans have been thrown out of work, and were the most solid pieces of evidence yet that the economy was in deep recession and potentially at risk of a depression. States and local governments have issued “stay-at-home” or “shelter-in-place” orders affecting more than 90% of Americans to curb the spread of COVID-19, the respiratory illness caused by the virus, and abruptly stopping economic activity in the country.
Retail sales plunged 8.7% last month, the biggest decline since the government started tracking the series in 1992, the Commerce Department said. Data for February was revised slightly up to show retail sales slipping 0.4% instead of falling 0.5% as previously reported. Economists polled by Reuters had forecast retail sales tumbling 8.0% in March. Compared to March last year, retail sales dropped 6.2%.
The $46.2 billion drop in sales in March was almost equal in a single month to the $49.1 billion peak-to-trough decline that unfolded over 16 months in the Great Recession. Last month’s decrease in retail sales reflected depressed receipts at car dealerships, with auto sales crashing 25.6%. With millions at home and crude oil prices collapsing amid worries of a deep global recession, gasoline prices have dropped, which led to a 17.2% decline in sales at service stations.
In addition, the closure of non-essential retailers knocked sales at clothing down 50.5% last month. Receipts at furniture stores collapsed 26.8% and spending at sporting goods, hobby, musical instrument and book stores plunged 23.3%. Sales at electronics and appliance stores decreased 15.1%.
U.S. retail sales, factory output sink as economy reels from coronavirus, Reuters, Apr 15