U.S. Restaurant Sales Return to Pre-Pandemic Growth Path
This article is published in collaboration with Statista
by Felix Richter
Retail and food services sales in the United States declined by 1.1 percent in July, dropping to $617.7 billion on a seasonally adjusted basis. That’s according to advance estimates published by the U.S. Census Bureau on Tuesday.
While it’s easy to chalk the slowdown up to the resurgence in COVID-19 cases, the reasons for the setback are in fact manifold, starting with an ongoing global chip shortage constraining supply in several industries, particularly the automobile sector. Sales of motor vehicle and parts dealers declined by more than $5 billion in July, accounting for 74 percent of the overall decline in retail and food services sales. Another big driver of the decline was a drop in nonstore (i.e. online) sales, which was largely caused by inflated June sales due to Amazon’s Prime Day. In fact, excluding motor vehicle and nonstore sales, retail sales grew ever so slightly in July, thanks in no small part to the ongoing rebound of restaurants across the country.
As the following chart shows, food services and drinking places, i.e. restaurants, bars, cafeterias, etc., continued their recovery in July, with sales climbing to an all-time high of $72.2 billion on a seasonally adjusted basis, up from a pandemic low of $29.9 billion in April 2020 and from $52.2 billion in July 2020. Likely due to a surge in COVID-19 cases in the second half of the month, sales growth slowed to the lowest rate since February, however, foreshadowing a possible setback in August, as many Americans are wary about the threat of the highly contagious Delta variant.
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