Retail sales were down 0.6% to $56.6 billion in September. The decline was led by lower sales at motor vehicle and parts dealers (-1.6%) as new car dealer sales (-2.8%) continued to struggle amid global supply shortages for semiconductor chips.

Sales decreased in 7 of 11 subsectors, representing 63.5% of retail trade. Core retail sales, which exclude gasoline stations and motor vehicle and parts dealers, decreased 0.3%. In volume terms, retail sales decreased 1.1% in September.

Retail sales were up 2.7% in the third quarter, the largest increase since the third quarter of 2020. In volume terms, quarterly sales were up 1.5%.

Based on respondent feedback, 0.5% of retailers were closed at some point in September, compared with approximately 0.6% in August. This is the third straight month that less than 1% of retailers experienced closures.

Given the rapidly evolving economic situation, Statistics Canada is providing an advance estimate of retail sales, which suggests that sales increased 1.0% in October. Owing to its early nature, this figure will be revised. 

Core retail sales decline on lower sales at clothing stores

Core retail sales decreased 0.3% in September. This comes as the Bank of Canada’s quarterly monetary policy report noted that as the impacts of the COVID-19 pandemic recede and confidence rises, spending on services such as travel and accommodation is expected to continue to strengthen, while growth in demand for goods may moderate.

The largest decline to core retail came from clothing and clothing accessories stores, where sales decreased 5.9% in September. Also contributing to the decline were lower sales at miscellaneous store retailers (-2.8%).

Higher sales were reported at food and beverage stores (+1.3%). Food prices continued to rise in September, up 3.9% from September 2020, with higher prices for meat products being a primary driver. Higher sales were also recorded at furniture and home furnishings stores (+1.3%).

Sales up in all provinces except Ontario

Sales were up in every province except Ontario (-4.4%) in September. The decrease in Ontario was largely driven by lower sales at motor vehicle and parts dealers. Sales were down 6.0% in the Toronto census metropolitan area (CMA).

Quebec (+2.0%) posted the largest provincial increase with sales up for a second consecutive month. In the Montréal CMA, sales were up 1.4%.

Retail e-commerce in Canada

On a seasonally adjusted basis, retail e-commerce sales rose 5.1% in September. On an unadjusted basis, retail e-commerce sales were up 1.8% year over year to $3.2 billion in September, accounting for 5.3% of total retail trade. The share of e-commerce sales out of total retail sales increased 0.4% in September compared with August and was down 0.2% from September 2020.

Source: Statistics Canada