Recession risk may be “behind us,” NRF and Hackett report says

The risk of a recession appears to be fading away, as strong economic signals show that imports and retail sales have stayed strong despite recent government interest rate hikes used to fight inflation, according to the Global Port Tracker report released today by the National Retail Federation (NRF) and Hackett Associates.

Instead of dipping abruptly, inbound cargo volume at the nation’s major container ports should continue to slow gradually in the final weeks of 2023 after reaching its peak later than expected this fall, the report said. 

NRF and Hackett are forecasting that total imports for 2023 will be 22.4 million twenty-foot equivalent units (TEUs), down 12.4% from last year. Imports during 2022 totaled 25.5 million TEU, down 1.2% from the annual record of 25.8 million TEU set in 2021.

“We originally thought peak season would come in August but imports kept growing in September and again in October,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said in a release. “Whether it was merchandise for retailers or cargo for other businesses, that’s a good sign for the economy and for the holiday shopping season. NRF expects record-setting holiday sales this year and retailers are well-stocked to meet consumer demand.”

The report predicts that 2023 holiday sales will increase between 3% and 4% over last year, in line with pre-pandemic growth rates, and will hit a record-setting total between $957.3 billion and $966.6 billion.

“The U.S. economy appears to be on a sustainable growth path as consumer demand remains buoyant,” Hackett Associates Founder Ben Hackett said, noting solid Black Friday weekend sales, strong corporate profits, and continued growth of gross domestic product. “It would be natural to assume that any thought of a recession is behind us, but a significant number of economists and politicians remain skeptical. As always, time will tell.”

U.S. ports covered by Global Port Tracker handled a higher-than-expected 2.05 million TEUs in October, the latest month for which final numbers are available. That was up 1.3% from September and up 2.5% from October 2022 for the first year-over-year increase since June 2022.

By topping September’s 2.03 million TEU, October should turn out to be the peak of the holiday shipping season. With 1.96 million TEU, August had originally been expected to be the peak month. The peak historically came in October but has occurred in August or sooner for seven of the past 10 years after a series of port labor disputes prompted retailers to bring merchandise into the country early to avoid potential disruptions near the holidays. 2020 was the most recent year that shipping peaked in October.

Global Port Tracker, which is produced for NRF by Hackett Associates, provides historical data and forecasts for the U.S. ports of Los Angeles/Long Beach, Oakland, Seattle and Tacoma on the West Coast; New York/New Jersey, Port of Virginia, Charleston, Savannah, Port Everglades, Miami and Jacksonville on the East Coast, and Houston on the Gulf Coast.