While many retail businesses in Michigan experienced a decline in sales throughout the month of June, several East Lansing retailers said their business remained steady.
In June, 55 percent of retailers in Michigan reported decline, while 34 percent saw increased sales and 11 percent saw no change, according to the Michigan Retail Index.
The Index is a joint project of the Michigan Retailers Association, or MRA, and the Federal Reserve Bank of Chicago that gauges retail activity in Michigan by surveying retailers, said James Hallan, president and CEO of the MRA.
“What we’re finding is (that) gasoline is taking a disproportionate share of discretionary income, which is usually spread across a number of retail sales,” he said.
“There is a correlation between retail, gas and what is spent on merchandise.”
Other factors contributing to the decline are the 8.5 percent unemployment rate in Michigan, the mortgage crisis and the disappearance of money from federal stimulus checks, Hallan said.
These checks were a onetime rebate given to households at certain income thresholds, and generated about $106.7 billion into the national economy.
The checks were primarily distributed throughout April and May.
“That money certainly gave a shot of Adrenaline to retail sales in Michigan’s economy,” Hallan said.
“It appears it was very short-lived, (as) it did not extend through June.”
However, several East Lansing businesses said that they did not see a large difference in their sales.
“(Our sales were) down a bit from last June’s sales, but we experienced a dramatic drop for the summer from students leaving, so we already anticipated a slow summer,” said Eric Merckling, owner of Scavenger Hunt, 503 E. Grand River Ave.
The store may be slightly better-off because it sells vintage clothing, which is cheaper than new clothing, Merckling said.
Paul Pickell, manager of Moosejaw Mountaineering, 555 E. Grand River Ave., said that his store hit its retail sales goal last month.
“It’s weird, you would expect that we would be down,” Pickell said.
“We’re down in items purchased, but we’re up in sales, so people are buying more expensive items.”
The report also stated that more than a third of Michigan retailers are hiring fewer summer workers than normal.
“We haven’t hired anyone in almost the entire summer,” said Chris Devon, an economics senior who works at BTB Burrito, 403 E. Grand River Ave.
“(And) a couple of my friends that tried to find jobs at beginning of summer just had to do odd jobs because they couldn’t find jobs around here.”
The report from the Index is not surprising, Merckling said.
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“It’s pretty easy to see times are tough, and people are spending money on things like movies, something to escape,” he said.
