Consumer Spending - June 2008
Consumer Spending - June 2008Data and Analysis
State tax revenue reports indicate that taxable retail sales in April remained sluggish overall. Growth was strongest in Alabama compared to weak levels a year earlier. Retail sales growth continued to slow in Georgia and Louisiana, while elsewhere in the District sales were similar to year-earlier levels.
According to our informal survey of District retailers, sales in May continued to disappoint. Most contacts reported that sales continued to decline in May compared with a year earlier. The majority of contacts reported that sales did not meet expectations. Reports indicated that inventories were declining, but most contacts still felt that inventories were too heavy in relation to current demand. The outlook among retailers was mixed but slightly more pessimistic than in April.
Vehicle sales in the Southeast weakened further in April and May. For April, District new vehicle registrations dipped 11.6 percent while national registrations were down 9.9 percent. District registrations were mostly affected by falling truck and SUV registrations. For May, contacts from leading import distributors reported strong consumer demand for fuel-efficient cars.
Sales of District-assembled vehicles through May were down 14 percent from 2007 levels, compared to a decline of 8 percent nationally. Of 25 vehicle models assembled in the District, only Mercedes M-class SUVs and Nissan's Altima sedans posted improved sales this year. Weak demand for full-sized trucks and SUVs have recently prompted cuts in production and hours across most auto plants in the region.
Tourism in the District remained strong overall although business and convention travel activity showed signs of slowing. For instance, convention center attendance in Florida's Orange County slipped by almost 9 percent in the first three months of this year, registering the lowest first-quarter level in five years. In anticipation that domestic travel may slow this summer, some new marketing campaigns have targeted leisure travelers within a three-hour driving distance.
New Orleans continued to increase tourist numbers by hosting big events. For example, attendance at the French Quarter festival in April increased by 4 percent, from 420,000 to 435,000, from last year to this year. Tourism in New Orleans is expected to get a further boost from the Audubon Insectarium, which opened in June. Nearly half a million people are expected to visit the insectarium annually, and the attraction is estimated to have an economic impact of $54.6 million, according to the Audubon Nature Institute. Passenger arrivals at the Louis Armstrong New Orleans International Airport increased 9.7 percent in April 2008 compared to a year earlier.
In Mississippi, gaming revenues were $108.4 million in May, rebounding from the small year-over-year decline in April.