In its annual forecast on prospects through year’s end, the National Retail Federation stated that it expects retail sales to grow between 6% and 8% to more than $4.86 trillion in 2022. NRF made the announcement during its annual State of Retail & the Consumer virtual event.
NRF believes that 2022 will generate strong job and wage growth with declining unemployment. The organization projects full-year GDP growth will slow this year versus 2021, coming in at about 3.5%, given the surge of inflation, tightening of monetary policy and less fiscal stimulus. Retail sales should remain strong as the economy opens further in the coming months as the COVID-19 pandemic weakens, but there is considerable uncertainty this year that NRF will continue to monitor closely, the organization pointed out.
“NRF expects retail sales to increase in 2022, as consumers are ready to spend and have the resources to do so,” NRF president and CEO Matthew Shay said in announcing the forecast. “We should see durable growth this year given consumer confidence to continue this expansion, notwithstanding risks related to inflation, COVID-19 and geopolitical threats.”
NRF chief economist Jack Kleinhenz said, “Most households have never experienced anything like this level of inflation, and it is expected to remain elevated well into 2023. In addition to inflation, the forces impacting the economy include COVID-19 impacts, international tensions and policy variability.”
Yet, Kleinhenz added consumer fundamentals remain in place: Household finances are healthy and strong job and wage growth should support solid growth for 2022 consumer spending.