In the latest retail trade analysis, July showed a 3.3% decrease compared to the same month in 2021, according to the National Institute of Statistics. Retail trade sales declined 0.5% year over year in calendar-adjusted figures. Despite a notable rebound in tourism, the overall performance for July signals softer consumption momentum, with consumer spending likely to cool further as inflation pressures persist. The accompanying rise in the consumer price index underscores a broader environment of cautious household purchases and tempered retail activity.
Employment in the retail sector reveals a mixed regional picture. The Balearic Islands recorded an 8.1% increase in employment, followed by the Canary Islands at 5.8%, contributing to a national uptick of 2.4% from July of the previous year. The sector has shown a steady rise for a fifteen-month stretch, and in the first seven months of the year, retail sales averaged a modest gain of 0.3% year over year when compared with the same period in 2021.
Product-level analysis highlights notable shifts. Service station sales rose by 7.7% in July, while overall year-on-year sales declined by 5.5 when excluding that sector. Food sales fell by 3.3% and household supplies by 3.4%, with other goods decreasing by 7.8%. A bright spot was a robust 8.9% increase in sales of personal equipment items, including clothing, shoes, and accessories. The uptick in activity at bars and restaurants may partly explain the softness in food store sales, as consumer spending reallocates toward hospitality experiences during peak tourist periods.
Distribution channels reveal divergent trends. Single-location firms saw average sales drop by 9.5% in July, while large chains, department stores, and small chains faced declines of 4%, 1.5%, and 0.5%, respectively. The shift of consumption toward tourist destinations explains a substantial portion of these changes, with regional dynamics closely tied to seasonal travel patterns and visitor flows.
Looking at the January-to-July window, sales in the sector declined for single-store operators by about 4% and for large chains by around 2%, yet small chains and large stores posted gains of 3.9% and 2.6%, respectively. Regions receiving higher tourist influx, such as the Balearic and Canary Islands, registered a 4.8% rise for the Balearics and a 3.4% rise for the archipelago overall, underscoring the persistent impact of seasonal tourism on regional retail performance.
Regional comparisons show mixed results. Some areas posted a modest 0.6% increase in sales, while others experienced year-on-year declines in July. Castilla-La Mancha, Asturias, and La Rioja each registered significant decreases, illustrating how local economic conditions and tourism patterns influence retail outcomes. The Community of Madrid and Catalonia also underperformed relative to the national average, reflecting the broader variability in regional retail dynamics across the country.