• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Retail Sales, Factory Data Show Growing Pains for U.S. Recovery

Retail Sales, Factory Data Show Growing Pains for U.S. Recovery

retail
A retail employee adjusts a store mannequin. Photo: Bloomberg.
June 16, 2021
Bloomberg

An onslaught of economic reports on Tuesday added to evidence of a U.S. recovery in full swing, yet one experiencing growing pains.

While retail sales in May fell more than forecast, Americans may simply be shifting more of their spending to services such as travel and entertainment. The government’s report also showed merchant receipts were stronger than previously reported during the prior two months, when stimulus checks powered demand.

Other data showed factory output last month was stronger than projected, helped by a rebound in auto production that remains beset by supply constraints and longer lead times.

Demand from consumers and businesses alike has flourished as the nation emerges from the pandemic and social activity picks up. At the same time, it’s caught producers and service providers off guard, leading to supply shortages for both materials and labor.

With demand outstripping capacity, inflationary pressures continue to build against a backdrop of extensive fiscal and monetary support.

A gauge of producer prices rose more than forecast in May, reflecting in part strong gains in margins received by wholesalers and retailers, the Labor Department reported Tuesday.

The Federal Reserve “believes supply chain bottlenecks and resource constraints are not permanent, but the time horizon for when those things will work themselves out is unclear,” FHN Financial economists Chris Low and Will Compernolle said in a note. “Meanwhile, price pressures continue to rise and demand is showing no sign of weakness.”

For their part, Fed officials, who conclude their two-day meeting on Wednesday, will debate whether it’s time to consider a shift in the central bank’s bond buying program because of the economic rebound so far. The Fed has said that the current surge in consumer prices, which jumped 5% in May, will be temporary.

For the last year, demand for goods has been propped up by elevated savings supported by fiscal stimulus, bringing total retail sales well above pre-pandemic levels. The 1.3% decline in May retail sales suggests that as travel picks up and entertainment venues reopen, spending on goods is starting to moderate.

While eight of the 13 major retail categories posted declines in sales receipts last month, a 1.8% increase at restaurants underscored a consumer shift to services spending.

Still, second-quarter consumer spending on merchandise is poised for a solid advance. Retail sales in the three months through May increased at a whopping 57% annualized rate.

The surge in demand has manufacturers struggling to keep pace. Factory output climbed 0.9% in May after a 0.1% April decline, the Fed’s report on Tuesday showed. The gain in factory output included a strong rebound in motor vehicle production and strength in machinery and chemicals.

Steady business investment, resilient consumer spending and a more recent pickup in export demand are all helping to fuel orders growth. When paired with a backdrop of lean inventories, factory output is poised to pick up steam in the months ahead.

Even so, headwinds remain. Producers continue to grapple with shipping delays, unfilled job openings and supply shortages like semiconductors.

The New York Fed’s index of manufacturing in the state showed more moderate growth in June. A gauge of delivery times climbed to a record high, while more factories reported shrinking inventories.

RELATED CONTENT

RELATED VIDEOS

Automotive E-Commerce/Omni-Channel Industrial Manufacturing Retail
  • Related Articles

    Growing Demand Brings Its Own Kind of Growing Pains                     

    Booming U.S. Imports Show Uneven Global Recovery Pace

    U.S. Online Holiday Sales Seen Growing at Slower Pace This Year

Bloomberg

Germany to Introduce Cheap Nationwide Public Transport From May

More from this author

Wake up to live
“Supply Chains in Crisis”
updates and the latest Supply Chain News!

Subscribe to our Daily Newsletter

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • A PERSON HOLDS UP A TABLET COMPUTER IN A WAREHOUSE, SUPER-IMPOSED BY A GRAPHIC SHOWING A COMPLEX WEB OF SUPPLY CHAIN ELEMENTS

    Three Post-Pandemic Actions for Repairing Global Supply Chains

    Data Management (Big Data/IoT/Blockchain)
  • A MAN IN A SUIT SHAKES HANDS WITH A WOMAN IN A HARD HAT, NEXT TO A STACK OF CONTAINERS

    Three Procurement Technology Evolutions for 2023

    Sourcing/Procurement/SRM
  • The blank stare of a child's eye who is standing behind what appears to be a wooden frame

    The Alarming Continued Rise of Modern Slavery in Supply Chains: How Procurement Can Help Reverse the Trend

    Sourcing/Procurement/SRM
  • A GROUP OF WORKERS RANGED IN AN OFFICE, OF DIVERSE RACE, GENDER, AGE AND PHYSICAL ABILITY

    Podcast | The Supply Chain Workforce of the Future Is Already Here

    HR & Labor Management
  • A YELLOW AND BLACK TRAFFIC SIGN THAT READS "VOLATILITY AHEAD"

    Four Strategies for Addressing Supply Chain Disruption

    Sourcing/Procurement/SRM

Digital Edition

Scb nov 2022 sm

2022 Supply Chain Innovator of the Year

VIEW THE LATEST ISSUE

Case Studies

  • New Revenue for Cloud-Based TMS that Embeds Orderful’s Modern EDI Platform

  • Convenience Store Client Maximizes Profit and Improves Customer Service

  • A Digitally Native Footwear Brand Finds Rapid Fulfillment

  • Expanding Apparel Brand Scales Seamlessly with E-Commerce Technology

  • How a Global LSP Scaled its Security Program and Won More Business

Visit Our Sponsors

Orderful Yang Ming Alithya
Barcoding Blue Yonder BNSF Logistics
CoEnterprise Data Capture Deposco
E2open GAINSystems Generix
Geodis GEP GreyOrange
Here Honeywell Intelligrated IFM
Infor Inmar Keelvar
Kinaxis Korber Lean Solutions Group 2H
Liberty SBF Locus Robotics Logility
LogistiVIEW Lucas Systems MCA Connect
MPO Nvidia Old Dominion
OpenText ORTEC Overhaul
Parsyl PMMI QIMA
Redwood Logistics Ryder E-commerce by Whiplash Saddle Creek Logistics
Schneider Dedicated Setlog Holding AG Ship4WD
Shipwell Tecsys TGW Systems
Thomson Reuters Tive Trailer Bridge
Vecna Robotics Verity
Verusen
  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • On-Demand Webinars
    • Upcoming Webinars
  • Digital Offerings
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • Newsletters
  • Resources
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
    • 100 Great Partners Form
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us
    • Data Sharing Opt-Out

All content copyright ©2023 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing