Albertans held their wallets a little closer in September, with new figures from Statistics Canada showing retail sales dropped by 1.1 per cent compared to August.
Todd Hirsch, chief economist at ATB Financial, said the decline is to be expected in a recession year.
“Consumer confidence is waning. People are feeling a little more nervous about going out and spending.”
Spending for the month also showed a significant drop compared to a year earlier, down 5.6 per cent. Hirsch said that can be explained in part by the fact September of 2014 happened to be a record-setting month for retail sales in the province.
“You don’t want to compare just one single month, September to September,” he said. “You are much better off looking at the full year, compared to the previous full year.
“We are down, but only a little bit, one per cent. But the trend is definitely to softer sales.”
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Despite the overall decline, Alberta still leads the provinces in retail sales per person. Hirsch pegs per capita spending at just over $1,500 in September. That’s $90 less than September of 2014, but still significantly higher than the national average of $1,208 per person. Demographics, he said, play a big role.
“We have by far the youngest population. We have more families in that early formation stage where they’re accumulating, they’re naturally going to be spending more than people in later stages of life.”
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Hirsch expects sales for the 2015 holiday shopping season will be “down a little bit” from last year. With oil prices falling to around $40 per barrel, he suggests that could spark more layoffs in the oil patch, and shake consumer confidence even among workers whose jobs may not be in jeopardy.
“I don’t think it’s worth people getting too excited about because we were coming off of record high sales about a year ago.
“So the fact that they’re coming off now, they are moderating, they are easing back,” added Hirsch.
“They’re not collapsing, and I think we should caution ourselves from being too alarmist about it. Some moderation in retail sales is precisely what we would expect to see at this point.”
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