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CHICAGO – U.S. retail spending remained steady in February, despite fluctuations from economic uncertainty, reports Circana. For the four weeks ending March 1, 2025, retail sales stayed flat compared to last year, with a slight 1% dollar growth. However, shifts in consumer behavior reveal emerging disruptions in discretionary and nondiscretionary spending.
“The paralyzing effects of economic uncertainty are starting to show up in short-term interruptions in discretionary consumer spending,” said Marshal Cohen, chief retail industry advisor at Circana. “On top of the existing concerns around inflation and the cost of goods, consumers are being inundated by headwinds that are creating pockets of behavior changes that have yet to impact the big picture.”
Recent trends show that some consumer segments are significantly changing their purchasing habits. Spending is slowing among those aged 55 and older and high-income consumers, who have been key drivers of retail growth in recent years. These shifts may lead to fragility in discretionary spending, impacting the retail sector broadly.
Retailers and manufacturers face an increasingly complex landscape influenced by inflation, tariffs, weather conditions, and political developments.
“The long list of change factors currently at play, from inflation and tariffs to weather and politics, are creating the potential for a perfect storm at retail, and the consumer is at the center of it all,” added Cohen. “In order to weather this storm, every retailer and manufacturer must remain aware of the activity both inside and outside their product and consumer sweet spots, and be prepared to make adjustments that will both calm and compel the consumer.”
