Retail federation economist says federal relief measure signed into law last week will help recovery
Americans have begun receiving $600 stimulus checks after Congress worked — but failed — to raise the amount to $2,000 per person in a last-minute holiday effort.
President Donald Trump after Christmas signed the $900 billion pandemic relief measure, which included stimulus checks as well as a second tranche of Paycheck Protection Program, or PPP, that had served as a lifeline for many restaurants in the summer.
Trump, before signing the bill, had complained the $600 was too low, so the U.S. House of Representatives on Jan. 28, in a 275-134 vote, passed a measure to increase stimulus checks for those under certain income level to $2,000.
Senate Majority Leader Mitch McConnell (R-Ky.) blocked requests to consider the $2,000 measure in that chamber before the 116th Congress adjourned Sunday.
Jack Kleinhenz, chief economist for the Nation’s Retail Federation, said economic challenges brought on by the coronavirus pandemic, which was declared in March, would continue into this year, although he said the relief measures should help maintain the ongoing recovery.
“Recoveries do not proceed in a straight line,” Kleinhenz said in the trade group’s Monthly Economic Review for January, “and the prospects for volatility over the next few months are high. Nonetheless, just like the old Timex watch commercials, the economy takes a licking but keeps on ticking.”
The $600 stimulus payments should boost spending, he added.
“Consumers responded quickly to last spring’s stimulus checks, and distribution of the new checks will come at a critical time that will help carry 2020’s momentum into 2021,” Kleinhenz said.
The legislation signed by Trump on Dec. 27 will provide one-time $600 stimulus checks to individuals making up to $75,000 a year and extends $300 weekly checks for the unemployed for almost three months.
Kleinhenz said that aid is particularly important to low-income families and the unemployed.
Retail sales for the first 11 months of 2020 (excluding automobile dealers, gasoline stations and restaurants) were up 6.6% over the same period in 2019 and November’s year-over-year increase of 8.8% put the holiday season on track to meet NRF’s forecast of between 3.6% and 5.2% growth, the NRF report said.
Results for the full holiday season will be released with the Jan. 15 Census Bureau report of December data.
Contact Ron Ruggless at [email protected]
Follow him on Twitter: @RonRuggless
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