The National Retail Federation (NRF) has revised its annual forecast for 2021, now saying retail sales are likely to grow between 10.5 percent and 13.5 percent, totaling over $4.44 trillion this year, according to a press release.
In February, the NRF projected a 6.5 percent increase. That prediction was made when the economic outlook was less certain and before March stimulus payments were made and vaccines were widespread, the release stated.
The new forecast comes as the economy continues to recover amid vaccinations and declining COVID-19 rates, according to the release.
“The economy and consumer spending have proven to be much more resilient than initially forecasted,” NRF President and CEO Matthew Shay said in the release. “The combination of vaccine distribution, fiscal stimulus and private-sector ingenuity have put millions of Americans back to work. While there are downside risks related to worker shortages, an overheating economy, tax increases and over-regulation, overall households are healthier, and consumers are demonstrating their ability and willingness to spend. The pandemic was a reminder how essential small, mid-size and large retailers are to the everyday lives of Americans in communities nationwide.”
Now, the NRF expects 2021 retail sales to total between $4.44 trillion and $4.56 trillion. Online and non-store sales will probably grow between 18 percent and 23 percent, hitting a range of $1.09 trillion to $1.13 trillion as consumers keep using eCommerce, according to the release.
The NRF said in the release that there will also be full-year gross domestic product (GDP) growth of around 7 percent, which is an increase from the expectations between 4.4 percent and 5 percent from earlier in the year.
eCommerce saw strong gains during the pandemic as COVID-19 made it so people couldn’t do their usual shopping in person. eCommerce sales surged to $26.7 trillion and grew from 16 percent to 19 percent of total retail sales, according to a report by the U.N. Conference on Trade and Development (UNCTAD).