In its first Monthly Economic Review of 2022, The National Retail Federation (NRF) predicted that the omicron variant of the virus that causes Covid-19 is unlikely to shut down stores, restaurants and other businesses—though the Washington, D.C.-based trade group noted there is no model to accurately predict what will happen. While the NRF believes stores will remain open despite the surge, online shopping has held on to the massive gains it experienced during the first two years of the pandemic.
During the all-important holiday shopping season, online sales grew 11 percent from last year’s record-breaking tally despite people returning to brick-and-mortar stores in the days before the omicron variant asserted itself, according to the Mastercard SpendingPulse.
Shoppers who had become accustomed to longer delivery times resulting from pandemic-related supply chain issues began their online shopping earlier than ever and e-commerce accounted for nearly 21 percent of overall retail sales in 2021 compared to 20.6 percent in 2020 and 14.6 percent in pre-pandemic 2019.
If the most recent surge of Covid infections does result in people staying home, the NRF’s Chief Economist Jack Kleinhenz said more spending could shift back online, which could have far-reaching consequences.
“Little is certain about omicron’s impact on consumer demand, but people who stay at home because of the variant are more likely to spend their money on retail goods rather than services like dining out or in-person entertainment,” Kleinhenz said. “That would put further pressure on inflation since supply chains are already overloaded across the globe.”