Consumer Behavior

Back-to-school sales, higher wages drive retail sales

Adobe Stock

August 25, 2023

Higher wages are giving consumers more money to spend and consumers are jumping on back-to-school sales, according to the National Retail Federation.

"July retail sales show consumers continue to drive the economy through this period of economic pressure with robust spending supported by steady job growth and wage gains," NRF President and CEO Matthew Shay said in a press release. "Retailers remain focused on providing essential items at competitive prices for families and students as we approach the end of an expected record back-to-class shopping season."

July got a midsummer boost from special deal days offered by multiple retailers, according to NRF Chief Economist Jack Kleinhenz.

"Households had a positive response, and the pace of sales was clearly helped, more than doubling the previous monthly gain. The data shows the ongoing resilience in consumer spending and how it is fueling the overall economy. It's worth noting that the strong year-over-year gain came partly because sales accelerated this July but were decelerating at the same time last year," he said in the release.

The U.S. Census Bureau reported overall retail sales in July were up 0.7% from June and up 3.2% year over year. That was double the increases seen in June, when sales were up 0.3% month over month and up 1.6% year over year.

NRF's calculation of retail sales — which excludes automobile dealers, gasoline stations and restaurants to focus on core retail — showed July was up 1% seasonally adjusted from June and up 3.8% unadjusted year over year. In June, sales were up 0.3% month over month and up 3.2% year over year. NRF's numbers were up 3.9% unadjusted year over year on a three-month moving average as of July and up 4% for the first seven months of the year.