Consumer Spending - May 2010
Retail sales posted modest growth in April but are still strong compared with a year earlier.
- Total retail sales in April rose 0.4 percent from March and are up 8.8 percent from a year earlier.
- Core retail sales declined 0.2 percent from March and are up 4.4 percent from April of last year. Core retail sales are back to prerecession levels but are still below the recent peak in July 2008.
The increase in retail sales in April was led by building material and garden equipment stores.
- The increase in retail sales over the month was led by building material and garden equipment stores, which increased 6.9 percent. Part of the surge is attributed to the sales of appliances due to an energy-efficient appliance rebate from the fiscal stimulus package.
- Most other categories were stable, with either small (less than 1 percent) increases or decreases.
Districtwide, consumer spending showed some improvement but is still down compared with last year. March sales tax revenues for the Sixth District states declined at a slower pace than in February.
- For the region overall, sales tax revenue was 4.7 percent lower than in March 2009.
- Sales tax revenue in the District overall increased 6.9 percent from February to March.
All states in the District experienced an increase in sales tax over the month and are improving compared with a year earlier.
Overall, tourism has been showing signs of improvement recently but is tempered by the unknown impact of the oil spill in the Gulf and the flooding in Tennessee.
- Smith Travel Research included six District cities in its list of top 25 U.S. tourist markets. Atlanta, Miami, Nashville, New Orleans, Orlando, and Tampa all had hotel occupancy rates above the national average of 58.4 in April.
- Business-related travel and convention bookings are up, and future bookings look strong, resulting in some pricing power in convention hotels. On the leisure front, cruise booking have been gradually improving, and the cruise lines have been able to increase prices slightly; however, onboard spending is still down. Similarly, contacts in the restaurant industry report a modest increase, and projections are optimistic.
- There is significant concern and uncertainty over the Gulf oil spill's potential impact on tourism, and projected losses vary among communities in the Sixth District. Contacts indicated that the potential impact on the Gulf Coast tourism industry is considerable, though some canceled bookings have been substituted by the presence of cleanup crews, laborers, and the National Guard or have moved to the Atlantic Coast.
- The flooding that occurred in Tennessee is also projected to negatively affect the state's tourism industry.
Mississippi gaming tax revenues decreased in April.
- From March to April, Mississippi's Gulf Coast gaming tax revenues decreased from $95.6 million to $93.3 million.
District-assembled vehicle sales increased 35 percent, ahead of the nation's pace.
- Sales of Hyundai-Kia jumped 99 percent on a year-over-year basis. One-third of the gains came from sales of the Kia Sorento.
- The outlook for sales is encouraging because vehicle inventories are low.
- District vehicle sales improved from last year's low levels for March and April.
- Industrywide, new vehicle registrations were up 12 percent on a year-over-year basis.
District Retail Survey
The District Retail Survey for April was positive but not as strong as in recent months.
- Most respondents reported that traffic as well as sales increased slightly from March to April. The modest increase in sales, following three months of strong gains, was also reflected in the national retail sales report for April. Survey participants noted that low-end products continued to sell in April while high-end product sales were weak.
- Retailers increased their inventory levels slightly, and all contacts reported they were satisfied with their inventory levels for the sixth consecutive month.