NRF’s Kleinhenz Keeping it Real About Retail
Jack Kleinhenz says the retail economy has “taken a significant step forward,” but it’s too early to tell on how long a recovery might take.
Like most everyone in the industry — not to mention Americans in general — National Retail Federation Chief Economist Jack Kleinhenz is glad to see the reopening of retail businesses during the past several weeks that had been shut down for weeks because of the coronavirus.
But while calling the re-openings of restaurants, department stores and other businesses “a significant step forward,” Kleinhenz said it’s too soon to say how quickly or smoothly the nation’s economy will recover from the businesses being out of commission for about two months.
“Is it possible the worst of the coronavirus pandemic is behind us? Maybe, but we are not out of the woods yet, and uncertainty abounds,” he said. “Predicting what will happen is even more challenging than usual. While history often helps guide us, previous downturns offer little guidance on what is likely to unfold over the next six to 12 months. There is no user’s manual in which government, businesses or consumers can find precise solutions for what we are going through.”
Kleinhenz noted that record drops in employment and retail sales and other indicators have resulted in “such unparalleled numbers that it is not comparable to anything in economic history and it has yet to catch up with the reality of what we are experiencing” economically.
“With such sizeable disruptions, it is difficult to tally the damage or determine the future,” he added.
With monthly and quarterly government data unable to keep up with the rapid changes seen during the pandemic, Kleinhenz said he welcomed three new weekly studies being produced by the U.S. Census Bureau — the Household Pulse Survey, the Small Business Pulse Survey and a weekly version of the Business Formation Statistics report.
While the first two show households have seen
reductions in income and most businesses do not expect to resume full
operations for six months, the third found new businesses are still being
formed despite the pandemic, with 9,000 applications for companies planning to
hire workers filed in a single week in mid-May alone.