Retail industry sales (which exclude automobiles, gas stations, and restaurants) will increase 4 percent from 2010, according to the National Retail Federation 2011 economic forecast. The retail trade association said the “cautiously optimistic outlook” comes on the heels of seven consecutive months of retail sales growth and better than expected holiday sales.
Consumer spending ended on a strong note in 2010 thanks to robust holiday spending figures, the prospects for economic growth are starting to look better, NRF said. However, small businesses hiring freezes and higher energy costs for consumers could curtail the speed and strength of the retail spending momentum.
“With retailers leading the charge, the economic recovery appears to be gaining some steam,” said Matthew Shay, NRF president and CEO. “The fate of the Main Street resurgence ultimately rests with policymakers on Capitol Hill. As Congress begins tackling key issues like deficit reduction and tax reform, it is critical we support policies that encourage job creation, consumption and business investment.”
According to NRF’s latest Retail Sales Outlook report, while consumers are once again showing a willingness to spend, inflation from rising commodity prices and continued high unemployment could become obstacles to economic growth.
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