The National Retail Federation (NRF) unveiled its 2018 economic forecast, projecting annual U.S. retail sales will increase between 3.8% and 4.4% over 2017. The positive projection comes after an encouraging 2017 holiday season that saw 5.5% sales growth in November and December. If retail sales did jump 4.4%, 2018 would have the biggest increase since 2011, when retail revenues climbed 5%.
The NRF projection is slightly higher than the eMarketer 2018 forecast, which anticipates 3.7% total retail growth.
NRF data indicates that online and other non-store channels, such as kiosks, catalogs, mail order and vending machines, will increase between 10% and 12% year-over-year.
The eMarketer report is far more bullish on digital, projecting growth of nearly 16%,with online sales reaching $526.1 billion in 2018. The firm anticipates that the percent of U.S. retail sales in e-Commerce will break into the double digits to represent 10.0% for the first time. The online percentage of retail sales is expected to increase every year through 2021, when it is projected to reach 13.7%.
In 2018, eMarketer anticipates there will be 190.3 million online shoppers in the U.S., an increase of 32% over 2017 and making up 69.9% of the population.
Mobile commerce will play a major role in digital sales, with eMarketer predicting a 32% sales boost through the channel. Mobile is projected to make up 39.6% of U.S. e-Commerce sales and 4% of total retail sales in 2018. By 2021, mobile’s share of total e-Commerce sales is expected to skyrocket to 53.9%.
Aside from delivering sales projections, the NRF report also highlighted more general economic-related trends in the U.S.:
- The overall economy is expected to gain an average of 163,000 jobs a month, down slightly from 2017;
- Unemployment is expected to drop from 4.1% in January 2018 to 3.9% by the end of the year; and
- Gross domestic product growth is likely to be in the range of 2.5% to 3%.
“The underpinnings of the economy are very good, and consumer spending is at the center of our outlook,” said Jack Kleinhenz, Chief Economist at NRF in a statement. “The push and pull of forces both external and internal to the U.S. economy will continue to provide challenges, but on balance we expect a good year. And as the retail industry continues to transform, retailers will leverage the new tax plan to invest in their employees, stores and new formats that engage with the ever-evolving and demanding consumer.”