A Disappointing 3rd Quarter for the Furniture Industry - Economic Influences and Catalysts Percent Growth by Quarter
This is the second factoid in a series of five factoids detailing the weakened 3rd quarter of 2016. The first quarter of 2016 in the furniture and bedding industry started off continuing the 5 percent plus growth over the previous year for all quarters in 2015. But as the year wore on, subsequent quarters did not perform to those levels. Quarter two fell to 3.7 percent growth and quarter three fell to 3.0 percent growth over quarter the same quarters of 2015. Year-end sales in 2015 totaled $92.5 billion. Third quarter year-to-date industry sales reached $71.5 billion, a 3.0 percent increase over the first three quarters last year.
The previous factoid detailed quarter growth from 2015 to 2016 of Furniture Industry Sales, Furniture Store Sales, and Personal Consumption Expenditures. This factoid focuses on economic influences and catalysts: Real GDP, Payroll Employment, and Consumer Price Index.
Real GDP. The furniture industry, aside from demographics, is driven by economic influencers and catalysts. Gross National Product, the measure of goods and services in the U.S., is chief among them. Real GDP growth has continued to decline since the first quarter of 2015 when growth was at 3.3 percent. Growth in 2016 has been steady, but slow, with quarterly averages between 1.3 percent and 1.6 percent.
Payroll Employment. The number of employed workers (non-farm) was at its highest level in history in October 2016 at 149 million. However, employment growth this year has slowed throughout each quarter. In 2015 growth averaged 2.1 percent year over year, but has fallen to an average of 1.4 percent increase in October 2016.
Consumer Price Index. For furniture and bedding, prices have been relatively stable, falling less than 1 percent from the prior year’s quarter, until the second quarter of this year. In 2016 Q2 prices were down 2.8 percent and in 2016 Q3 down 3.1 percent.
Source: *Bureau of Economic Analysis, U.S. Dept of Commerce; **U.S. Census Bureau, Not seasonally adjusted, 2016Q4 includes only month of October; ***U.S. Bureau of Labor Statistics, Seasonally adjusted