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Retail sales end 2017 on a high note

Retail sales end 2017 on a high note

Posted on: 2/22/2018 | Author: ATB Financial's Economics + Research Team


Sales at Alberta retailers grew at 7.5 per cent in 2017, with the province's growth rate nearly one percentage point higher than the national average. Not surprisingly, the retail sales growth in our province was the highest rate seen since the 2015-2016 recession.

Total retail sales rang in at $6.74 billion in the final month of 2017, down only slightly from November’s total (-0.46 per cent). (December’s total is adjusted for seasonality.) The rise in retail sales can be attributed to two things: An improvement in economic conditions and a rise in consumer confidence.

At the end of 2014, shoppers pulled back their spending in light of plunging oil prices and soaring unemployment. After significant cuts to jobs (in 2015 and 2016), Alberta's labour market added 55,000 workers in 2017. The unemployment rate fell from 8.6 per cent at the end of 2016 to 7.0 per cent at the end of 2017. These employment gains have signalled an improvement in our economy and they’ve given Albertans confidence as well. As a result, retailers are starting to benefit.

Retail sales momentum will likely continue in 2018. However, with rising interest rates and mounting household debt, sales growth will likely begin to slow. In fact, it already is (see chart below). It’s also likely that the unemployment rate will be slow in its decline and may prompt some Albertans to keep their wallets a little closer to their chest.

Year-over-year retail, graph​ ​

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