Retailers see improvement, but skeptical about stimulus
LANSING — Michigan retailers improved their monthly sales and outlook during February, but said they don’t believe the federal stimulus package will have much impact on their businesses, according to the Michigan Retail Index, a joint project of Michigan Retailers Association and the Federal Reserve Bank of Chicago.
In fact, more retailers thought the stimulus package would do more harm (20.6 percent) than good (14.5 percent) to their businesses. The majority (64.9 percent), however, said they expect the wide-ranging, billion-dollar initiative to have no impact on them at all.
Although retail continues to struggle as unemployment rises in Michigan, retailers bounced back from a dismal January. Another encouraging sign was that their optimism also moved up — for the third month in a row — despite holding out little hope that their stores will benefit from the billions of dollars being spent as part of the stimulus package.
The Michigan Retail Index survey for February found that 32 percent of retailers increased sales over the same month last year, while 54 percent recorded declines and 14 percent saw no change. The results create a seasonally adjusted performance index of 40.8, up from 29.0 in January.
Index values above 50 generally indicate an increase in positive activity, while values below 50 indicate a decrease.
Looking ahead, 34 percent of retailers said they expect higher sales during March-May over the same period last year, while 41 percent project a decrease and 25 percent no change. That puts the seasonally adjusted outlook index at 44.6, up from 41.6 in January.
James P. Hallan is president and CEO of the Michigan Retailers Association, the nation’s largest state trade association of general merchandise retailers.