New data on taxable sales from 2010 to 2011 released by the Maine Bureau of Revenue Services shows a very slow and steady increase in sales activity, a sign that consumers remain cautious, according to University of Maine Cooperative Extension specialist and professor of economics.
McConnon is available to discuss the sales figures and additional implications. To reach Professor McConnon, contact George Manlove at (207) 581-3756.
Total taxable sales rose from $16.4 billion in 2010 by 3.6 percent, to $17 billion in 2011, with building supplies and automotive and transportation categories leading the market with a 6.4 percent increase and a 5.2 percent increase, respectively. Because of much lower spending increases in other categories, including food, general merchandise, restaurant and lodging business spending and others, the overall taxable sales figures show a 3.6 percent increase.
“We’re just growing very slowly,” says McConnon. “If you take into consideration inflation at 3.2 percent, overall sales growth was relatively flat.”
McConnon notes, also, that fourth-quarter taxable sales – which reflects holiday shopping — carried the year in sales gains. A comparison of fourth-quarter sales of building supplies for 2010 and 2011 reflected a 14.1 percent increase, from $522.3 million to $596 million. Auto and transportation, which does not include fuel purchases, rose 7.6 percent in the fourth-quarter comparison, from $786.5 million in 2010 to $846 million in 2011.
A comparison of all taxable sales in the fourth quarters of 2010 and 2011 shows a 4.9-percent jump, from $4.3 billion to $4.7 billion.
“The retail sector is a very important sector of Maine’s economy,” McConnon says, “and we often times look at it as an indicator of consumer spending. The overall finding is that spending increased in 2011, but very little.”
McConnon also observes that big box and department store sales declined by .4 percent while specialty stores (jewelry, sporting goods and mom and pop stores) were up 3.4 percent over the year-long analysis.
Taxable sales, though creeping up, still do not equal Maine’s sales levels in 2007 the year the recession started, according to McConnon, who notes that the increase in taxable retail spending in Maine recently correlates with rising consumer confidence in the stock market.