Retail sales are projected to increase 4.1% in 2014 as the economy continues to improve, the National Retail Federation said.
The projected rise from 3.7% growth in 2013 excludes automobile, gas station and restaurant sales. The retail group also said it expects online sales to grow between 9-12%.
“Measured improvements in economic growth combined with positive expectations for continued consumer spending will put the retail industry in a relatively good place in 2014,” Matthew Shay, CEO of NRF, said in a statement.
“Though headwinds in the form of the looming debt ceiling debates, increased health-care costs and regulatory concerns still pose risks for both consumers and retailers, we are cautiously optimistic and hopeful that the economic tides will change in 2014,” Shay said.
The organization estimates growth in the economy measured by real gross domestic product could increase 2.6-3%, the fastest pace in three years.
The labor market is expected to add 185,000 jobs per month, helping to lower the unemployment rate to 6.5% by the end of 2014, according to NRF.
“The economy remains susceptible to buffets as we are already witnessing in the new year, thanks to harsh winter weather, [and] domestic and global financial issues,” NRF chief economist Jack Kleinhenz said in a statement.
“While we are careful not to ignore the challenges, we are optimistic and hopeful that future disruptions will be limited, allowing employment and business investment to grow, all the while giving retailers and their customers the confidence in the economy they need.”