Discovering Retail Sales Excluding Auto Data

What you should know:

• RSEA data is a strong economic indicator for fluid power.
• RSEA has a 96.2% correlation with Total Fluid Power Shipments.
• RSEA data is included in NFPA’s Customer Market File (CMF).
• NFPA and the Stats Toolkit make it easy for you to use RSEA as a possible leading indicator for your company.

Retail Sales Excluding Auto (RSEA) tracks consumer demand for finished goods by measuring the purchases of durable and non-durable goods, excluding motor vehicles, over a defined period of time. RSEA capture in-store sales, as well as catalog and other out-of-store sales, of both durable (lasts for more than three years) and non-durable goods (those with a three-year or shorter life span). An accurate measure of RSEA is vital for gauging the economic health of the U.S. given that consumer spending accounts for two-thirds of gross domestic product (GDP). Retail Sales figures are often presented in two ways – with and without the inclusion of auto sales. Most economists choose to analyze retail sales without including car sales because these figures tend to fluctuate more than other sales. As a leading macroeconomic indicator, healthy RSEA figures typically elicit positive movements in our economy and a possible increase in inflation, while lower RSEA figures indicates a contracting economy and could translate to a decrease in inflation.

Alan Beaulieu, President of ITR Economics, often emphasizes the importance of RSEA at NFPA events as an indicator of the U.S. economy, U.S. employment and the U.S. fluid power industry. Many economic firms, as well as news and social media sources, monitor and report on the trends involving RSEA. St. Louis Federal Reserve Bank, CNBC and Advisor Perspectives all report on recent trends in RSEA.

RSEA data and analysis are collected and reported on a monthly basis by the U.S. Census Bureau and published in the Advance Monthly Retail Trade Report.  The report shows the total number of sales in the measured time period, usually the prior month, and the percentage change from the last report. The report also includes the year-over-year change in sales and offers both seasonally adjusted and non-seasonally adjusted views of all data and analysis. The U.S. Census Bureau’s Monthly Retail Trade webpage offers full access to the report and all historical data.

NFPA RSEA Resources

As with many government and public data sources, NFPA familiarizes itself with those cryptic coding systems, confusing data layouts and ancient data formats so we can extract, organize and release this same data in a user-friendly format as an exclusive benefit of membership.  The U.S. Census Bureau’s RSEA is available in an organized manner on NFPA’s website.

Access to key customer market and leading indicator data series such as the RSEA data sets are available via NFPA’s Customer Market File (CMF) on the NFPA website. The CMF is a monthly file containing data and trend graphs for key U.S. customer markets, popular economic indicators and producer pricing that can be used for your own internal analysis needs or easily transferred into analytical tools such as NFPA’s Stats Toolkit.

NFPA’s RSEA Support Tools

Take your analysis to the next level with NFPA’s Stats Toolkit and examine the strength of the relationship between your company data and RSEA data. The Correlation Analysis Report, one of five custom data analysis/visualization tools in the Stats Toolkit, allows users that are searching for important indicators and drivers for their company to explore lead/lag and correlation analysis to recognize relationships between two data series. This report not only identifies the correlation percentage between data series for a specific date range, but also applies a monthly lead/lag effect. When shifting one data series forward (in monthly increments) to the cross-corelated data series, members can discover if the correlation percentage strengthens or weakens to possibly reveal a leading indicator for another data series.

Above is an example of the Correlation Analysis Report as we examine the 104-month relationship between Total Fluid Power shipments (TFP) and RSEA with a 12-month moving average calculation applied to both data series. The “correlation analysis with lags chart” identifies a correlation of 96.2% occurs when the leading series (Retail Sales Excluding Auto) has a 0-month lead/lag effect applied, or Coincident Relationship. Generally, a correlation of 75% or above is deemed a very strong relationship and a good economic indicator for your industry/company.

The Correlation Analysis Report also helps the user generate a trend graph that applies no lead to the leading series (RSEA) for visual confirmation of the relationship between the two data series.

Confidently evaluate the relationship between your company and RSEA data with the Stats Toolkit, NFPA’s cloud-based data analytics and visualization support tool that is available exclusively to NFPA members. This online platform expands our members’ economic view of their company by combining the user’s unique company data and NFPA data sources with popular analytical tools to identify market trends, recognize data relationships and develop custom projections within the fluid power industry.

Want to Learn More About the Stats Toolkit?

NFPA offers a 60-minute one-on-one Stats Toolkit Walkthrough Webinar that includes a detailed review of this online tool and how to operate each application, while identifying which functions are best suited for your analytical needs.  Schedule a date and time with Eric Armstrong.

Questions?  Contact Eric Armstrong, NFPA’s Economic and Statistical Programs Manager, at earmstrong@nfpa.com or (414) 778-3372.