Retail and Tourism Most retail contacts report that sales continued to show strong growth in the April through June quarter, either matching or bettering expectations for the period. Sectors of strength were upscale and mail-order apparel and office supplies and office technology products. The tourism industry is also robust. In all sectors, inventories are at desired levels. However, these contacts say their Asian mail order business may be bottoming out and the loss of Asian tourists is being offset by increased business from Europe.
Retailers indicate that employment is generally level, increasing only with store expansions.
Wage growth has picked up a notch from the earlier 3 to 5 percent range to a 4 to 7 percent annual pace. Respondents say prices and gross margins are holding steady. The exception is hotel room rates, which continue to show sizable increases. A majority of retail contacts say significant capital expansions are either planned or in progress. Looking forward, most retailers express cautious optimism.