Despite the ongoing coronavirus outbreak, uncertainty over global trade and the presidential election that have made each day of 2020 feel like an entire year, retail is doing just fine, according to the National Retail Federation.
The trade association released its predictions today for 2020, forecasting between 3.5% and 4.1% growth in retail sales. Online sales specifically will grow between 12% and 15%, according to the NRF.
The expansion would put total retail sales in the U.S. at more than $3.9 billion.
“With gains in household income and wealth, lower interest rates and strong consumer confidence, we expect another healthy year ahead,” said NRF president and CEO Matthew Shay in a statement. Acknowledging that coronavirus and the election serve as “wild cards,” he added that “when it comes to the fundamentals, our economy is sound, and consumers continue to lead the way.”
Last year, retail sales grew by 3.7%, falling just short of the NRF’s prediction of 3.8%. (It’s worth noting, however, that those predictions were based on partial information because of the government shutdown.)
If shoppers spend as predicted this year, 2020 will mark the 11th straight year of growth for the industry.
While the economy is growing “at a more modest pace,” according to NRF chief economist Jack Kleinhenz, “the underlying economic fundamentals remain in place and are positive.”
Pointing to low unemployment, interest rates and inflation, Kleinhenz said in a statement that consumers remain confident enough to spend. “The steady wage growth that has come with the strong job market is fueling their spending,” he added. “The state of the consumer is very healthy.”
Even so, corporate leaders are still wary that last year’s trade war could resume, which would discourage investments, according to Kleinhenz. And there are still lingering questions regarding how coronavirus will affect supply chains.
This forecast, the NRF noted, assumes that coronavirus will not become a global pandemic.