The National Retail Federation (NRF) has projected that retail sales in the United States will see a growth of between 2.7% and 3.7% in 2025, reaching a total between $5.42tn and $5.48tn.
This forecast was unveiled during the NRF’s fifth annual State of Retail & the Consumer virtual event, where the health of American consumers and the retail industry were discussed.
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The forecast for 2025 follows a 3.6% increase in retail sales in 2024, which amounted to $5.29tn. This anticipated growth rate aligns with the 10-year pre-pandemic average, further indicating that retail sales are expected to maintain a steady upward trend.
Economic outlook and consumer behaviour
Despite ongoing policy uncertainty and its potential impact on consumer and business confidence, the US economy has shown positive signs in 2025. Unemployment remains low, and wage growth continues to be steady, contributing to a more optimistic economic landscape.
However, NRF President and CEO Matthew Shay highlighted that significant policy uncertainties are still a concern.
Jack Kleinhenz, Chief Economist at NRF, pointed out that while consumer confidence has seen a decline, primarily due to inflation and tariffs, the fundamentals of consumer spending remain strong.
He emphasised that low unemployment, consistent income growth, and solid household finances continue to support consumer behaviour, even though concerns about inflation persist.
Growth in online and non-store sales
A notable segment of the retail forecast is the growth in online and non-store sales, which are projected to increase by 7% to 9% year on year. This would bring total sales in this category to between $1.57tn and $1.6tn.
In 2024, non-store and online sales had grown by 8.1%, reaching a total of $1.47tn.
While in-store retail continues to be a significant part of the market, online sales are expected to make up a growing share of total retail sales. The shift towards e-commerce is a trend that has gained momentum in recent years, a pattern that shows no signs of reversing in 2025.
Economic growth and inflation impact
Looking at the broader economic picture, NRF expects the US GDP growth to slow down in 2025, falling to just under 2%, compared to 2.8% in 2024. This forecast reflects the ongoing uncertainties and the potential long-term effects of tariffs and inflation.
In terms of inflation, NRF predicts that the Personal Consumption Expenditures (PCE) inflation rate will remain at around 2.5% in 2025, which mirrors the current rate.
However, while consumer sentiment has shown signs of weakening, the real economic data, including employment figures and household finances, continue to support expectations of steady consumer spending.
As long as the labour market remains strong, the outlook for consumer credit and household balance sheets should remain stable.
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