DALLAS – Employment is slowing, but not enough to deter consumer confidence or what industry observers call a strengthening retail market.
“We’re in this period of steady momentum,” said John Chang, first vice president of research services for Marcus & Millichap Real Estate Investment Services.
Speaking at the firm’s April 21 retail forum at the Westin Galleria Dallas, Chang told leading retail developers that consumers are spending money again, online retailers are opening bricks-and-mortar stores and Texas is sprinting ahead of the nation in employment growth.
Between January 2014 and January 2015, Dallas-Fort Worth’s non-farm employment grew 4.4 percent, according to the U.S. Bureau of Labor Statistics. That compares to the national rate of 2.3 percent in the same period.
“Put a star on it and call it done,” said Chang, eliciting laughter from developers otherwise disturbed by the latest jobs news.
Despite Texas’ 2014 employment growth, this year started out weaker. Employers in 31 states cut jobs in March, with energy companies leading the charge. Texas lost the most, with 25,400 jobs pared in the same month that employers nationwide added just 126,000 jobs, less than the 200,000-plus jobs added every month in the past year.
The month saw the U.S. employment rate stall at 5.5 percent.
Despite the dip, consumers are spending money and appear upbeat.
“We’re almost back in alignment of where we were in 2006-’07,” said Chang, describing consumer confidence as recovering to pre-recessionary days.
According to The Conference Board’s latest index report, U.S. consumer confidence rose from 98.8 in February to 101.3 in March. The monthly consumer confidence survey, based on a probability-design random sample, is conducted for The Conference Board, a nonprofit research association, by the Nielson analytics firm.
“Consumer confidence improved in March after retreating in February. This month’s increase was driven by an improved short-term outlook for both employment and income prospects; consumers were less upbeat about business conditions,” said Lynn Franco, director of economic indicators with The Conference Board, commenting in a news release.
Helping boost retail is online commerce, with Internet sales up 65 percent compared to pre-recession numbers, Chang said. Such transactions represent 11 percent of the nation’s total retail activity, up from 5 percent just 10 years ago.
Meanwhile, Internet sales have risen 65 percent since the lowest point of the recession, Chang said. What Chang called a “convergence” is seeing online retailers pursuing bricks-and-mortar stores, such as Amazon.com’s interest in acquiring some RadioShack locations, while Wal-Mart and others are pursuing online sales.
“This isn’t just about Amazon. We’re seeing a convergence, with additional retailers continuing to building a presence on the Web,” Chang said.