A Second Look at the Retail Sales Numbers

The Commerce Department announced today that retail sales for the month of March 2009 declined versus February 2009.

Advance estimates of U.S. retail and food services sales for March, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $344.4 billion, a decrease of 1.1 percent from the previous month and 9.4 percent below March 2008. Total sales for the January through March 2009 period were down 8.8 percent from the same period a year ago.

Interestingly, the entire decline in March can be attributed to the adjustment factors applied by Commerce. Real non-adjusted sales were up across the board.

Here are the non-adjusted numbers:

Retail & food Services, total.................... +9.8

Total (excl. motor vehicle & parts ).......... +8.9

Retail .................................. +9.8

Motor vehicle & parts dealers.................... +14.2

Auto & other motor veh. dealers................ +14.4

Furniture & home furnishings stores.............. +6.5

Electronics & appliance stores................... -8.2

Building material & garden eq. & supplies dealers +28.1

Food & beverage stores........................... +7.4

Grocery stores.................................. +7.4

Health & personal care stores.................... +7.6

Gasoline stations................................ +12.3

Clothing & clothing accessories stores........... +9.0

Sporting goods, hobby, book & music stores........ +12.1

General merchandise stores....................... +7.4

Department stores (ex. L.D.).................... +9.4

Miscellaneous stores retailers................... +4.1

Nonstore retailers............................... +3.6

Food services & drinking places.................. +9.5

I have never been a big fan of seasonally adjusted numbers. Tell me what is actually going on in an economy, not some "adjusted" number. Commerce does not provide enough detail in their release to know what exactly the specific adjustments are. Of course, March has 3 more selling days than February, so you do have to adjust for that. Reducing March sales by 10% (for the 3 additional days) in all categories creates more of a mixed bag situation with some sectors up and some down and pretty much a flat report versus February.