US Retail Sales Reveal Surprise Increase in September Despite Ongoing Supply Shortages

A customer pushes her shopping cart at a Walmart store in the Porter Ranch section of Los Angeles on Nov. 26, 2013. Kevork Djansezian/Reuters

American retail sales rose unexpectedly in September amid ongoing supply chain shortages, raising concerns as the nation nears the holiday shopping season.

The U.S Census Bureau announced Friday a 0.7 percent increase from August. The July–August increase was also revised up to 0.9 percent instead of the 0.7 percent earlier reported (pdf).

The increase was partly influenced by inflation. The economy saw a strong rise in prices over the same period.

The increase could also be somewhat attributed to students returning to campus and more workers returning to offices following COVID-19 pandemic restrictions.

The positive signs, however, have not changed the concerns of those who continue to see issues with the nation’s supply chain entering the fourth quarter of the year.

The supply chain crisis led President Joe Biden to make new announcements this week to address congestion at some of America’s ports.

“After weeks of negotiation and working with my team and with the major union and retailers and freight movers, the Ports of Los Angeles—the Port of Los Angeles announced today that it’s going to be—begin operating 24 hours a day, 7 days a week,” Biden announced.

“This follows the Port of Long Beach’s commitment to 24/7 that it announced just weeks ago,” he added.

Biden called the effort a “first key step” to improving the nation’s supply chain.

The president’s speech also announced the expansion of shipping companies to meet the growing demands.

“Additionally, FedEx and UPS, two of our nation’s biggest freight movers, are committing today to significantly increase the amount of goods they are moving at night. FedEx and UPS are the shippers for some of our nation’s largest stores, but they also ship for tens of thousands of small businesses all across America,” he added.

The changes should help, but inflation continues to serve as a concern for the economy.

White House Press Secretary Jen Psaki said Wednesday inflation has “decelerated” by 50 percent in recent months.

“We’ve seen a decrease over the course of time,” she told reporters. “Over the second and third quarter of this year, monthly inflation increases have actually decelerated.”

The rate of inflation may be slowing from previous reports, but it has not ended.

The Producer Price Index News Release summary reported Thursday “the final demand index rose 8.6 percent for the 12 months ended in September, the largest advance since 12-month data were first calculated in November 2010.”

The largest increase was due to the cost of goods, contributing 80 percent of the overall inflation change over the past year.