Sales fell 1.1% last month from October, the Commerce Department said Wednesday. According to a survey conducted by Refinitiv, sales were expected to fall 0.3% month-on-month in November.
“The figures are much weaker than expected,” Gus Faucher, chief economist at PNC’s Financial Services Group, said in an email. “The economy looks much softer by the end of 2020.”
Clothing stores, restaurants, electronics stores and gas stations caused sales to fall while spending on grocery stores and online retailers increased.
Overall, retail sales are up 4.1% from last year. Spending on online retailers has increased by 29.2% over the same period last year.
During the pandemic, retail sales have been helped by federal relief programs, but these have ended.
In late July, an additional $ 600 weekly unemployment insurance was exhausted, which had been part of the government’s first stimulus bill. Since then, Congress has not been able to agree on a new boost to unemployment benefits.
“Without stimulus, retail sales declines are likely to continue and may become severe as millions of Americans lose their unemployment benefits the day after Christmas,” said Robert Frick, a corporate economist at the Navy Federal Credit Union , in a note to clients Wednesday.
This year there is a wide range of holiday forecasts, reflecting the uncertainty surrounding the pandemic. Real estate firm CBRE forecasts holiday sales will rise by less than 2% this year from 2019. Meanwhile, Wells Fargo economists have forecast a 9% increase as consumers spend their spending from areas such as travel to toys, electronics and other gifts.