According to the latest data from the Census Bureau, the recession in the retail sector of the U.S. economy is over. Let that sink in a minute. Now I know the retail sector is not the entire economy, so there is still more work to do. But it large and significant, and it also affects a huge piece of the plastics industry.
Here is a rundown of the numbers. Total retail sales for July posted a gain of greater than 1 percent when compared with the June tally, and aggregate receipts escalated almost 3 percent when compared with July of last year. For those of you who are really keeping score, total retail sales in July were also up more than 1.5 percent on a seasonally adjusted basis from the February total, which was the last month before we were all rudely awakened to the arrival of COVID-19 in this country.
I find this remarkable because many states are still in some version of an economic shutdown, the national unemployment rate is in double digits, and consumer confidence levels are best described as subdued. All of this notwithstanding, total retail sales expanded by more than 2 percent this summer when compared with last year.
To be fair, I should point out there are other sectors of the U.S. economy that remain mired in recession. The retail sales data is composed mainly of establishments that sell goods rather than services, and the recovery in the service sector is still at least a few months away. And there can be no doubt this rise in retail activity was fueled by the vast amount of fiscal stimulus injected into the economy in the second quarter.
But those stories are already well known. I think the most interesting stories that are newly emerging in the data this quarter are the wide divergences in the recovery rates among the various segments of the retail sector.
I have charted the 12-month rates of growth for a few of the major retail segments. At first glance, this chart looks like a tangle of spaghetti, but I encourage you to pause a few minutes and take a closer look. Not only are there some unusual trends in recent months, but there are also some wide discrepancies in how these sectors have performed recently when compared with how they performed the last time there was a severe economic recession just over 10 years ago.
And as you ponder the recent patterns in this chart, take a moment to consider what these trends indicate about the most probable future economic conditions. For instance, do they reflect permanent shifts in how retail trade will be conducted as we collectively move forward in time, or are they one-time blips that will revert back to the mean as the risks from COVID-19 begin to subside. This is what I mean when I talk about interesting stories.