WASHINGTON (AP) – U.S. retail sales plummeted 8.7% in March, an unprecedented decline, as the viral outbreak forced an almost complete lockdown of commerce nationwide.
The deterioration of sales far outpaced the previous record decline of 3.9% that took place during the depths of the Great Recession in November 2008.
Auto sales dropped 25.6%, while clothing store sales collapsed, sliding 50.5%, the Commerce Department said Wednesday. Restaurants and bars reported a nearly 27% fall in revenue.
U.S. consumer confidence has plunged and the vast majority of Americans are hunkered down at home under shelter-in-place orders. Consumer spending drives two-thirds of the U.S. economy, and the record drop in retail sales is a symptom of the sharp recession that most economists believe the U.S. has already entered. Economists at JPMorgan Chase now forecast the U.S. economy will shrink by a record-shattering 40% in the April-June quarter.
“With clear signs of panic buying of necessities and the fact that lock downs were introduced only around the middle of the month means that far worse is to come in April and the second quarter more generally,” said Michael Pearce, an economist at Capital Economics, a consulting firm.