US & Global Economic Impact Analysis and Forecasts

Freedonia analysts and economists are sharing their insights on how major events are impacting different parts of the US and global economies.

Despite Slight Decline, Retail Sales Outlook for Building Materials Retails Remains Strong

The release of the May retail sales report by the US Department of Commerce on June 15 showed that the US market for building materials and construction products remained strong during the month. Retail sales by building materials and garden equipment and supplies dealers declined slightly from their level in April. Some of the possible causes of this decline can include:

  • high prices for lumber and other building materials (such as copper wire and plastic products), which caused some consumers to delay work until prices became more affordable
  • shortages of key materials due to supply chain issues – disruptions in one phase of a project can delay others, and with high prices, builders and contractors may hold off on product purchases until materials are actually needed
  • shifts in consumer spending – with many states and localities “reopening” and lifting restrictions on dining out and other forms of entertainment, many consumers (especially those who have already invested in their homes) might have opted to spend on other things

However, retail sales by building materials and garden equipment and supplies dealers remained strong. Indeed, compared to this time in 2020, sales in 2021 were more than 20% higher. Most building materials and garden equipment and supplies dealers remain confident in the strength of their industry due to such factors as:

  • continuing high levels of new home construction and homeowner interest in home renovation and repair projects, boosting demand for building materials
  • the advent of summer, which means longer days with better weather that allow for more time for construction projects
  • summer is a traditional buying period for both lawn and garden supplies and equipment, as well as the products (pool supplies, outdoor toys) frequently sold at home improvement and garden centers
  • the end of school means more teenagers will be available to work landscaping jobs – offering time-pressed contractors a way to catch up with their backlogs of work

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, particularly in the Construction and Building Products. Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Construction & Building Products      Consumer Goods      Covid-19