Excess inventory has racked up in many retailers’ warehouses and stores. But shoppers are still paying more as they refresh the closet.
Apparel prices rose 0.8% in June compared to May, and 5.2% year over year, according to the Bureau of Labor Statistics’ consumer price index Wednesday. Overall, the inflation gauge, which includes everyday items such as food and gas, rose a higher-than-expected 9.1% from a year earlier.
In recent weeks, many prominent companies and investors have warned of a recession. Retailers, including Target, Gap and Walmart, announced plans for more markdowns to get rid of unwanted merchandise.
Yet apparel sales and prices — at least so far — are topping last year’s levels. The labor market remains robust, too: The jobs report for June defied recession fears, as the unemployment rate remain unchanged and payrolls beat expectations.
“It’s all about experience,” said Kristen Classi-Zummo, an industry analyst who covers fashion apparel for The NPD Group. “A return to getting back out is really what’s driving the apparel growth. This experiential re-emergence that we still didn’t see fully last year.”