US retail sales plummeted 8.7% in March, an unprecedented decline that came 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. Signifying the titanic shift in consumer behavior, grocery store sales jumped by nearly 26% as Americans stocked up on food and consumer goods to ride out the pandemic, reports the AP.
Consumer spending drives two-thirds of the US economy, and the record drop in retail sales is a symptom of the sharp recession that most economists believe the US has already entered. Economists at JPMorgan Chase now forecast the US 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 lockdowns 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. Wednesday's report doesn't include spending on services such as hotel stays, airline tickets, or movie theaters. (Read the full story for much more.)