US Wholesale Sector NAICS 42

Apr 17, 2025 - Average Growth Expected

• The US wholesale industry is projected to grow at a 4.1% CAGR from 2025 to 2029, comparable to the overall economy's projected growth, according to a forecast from Inforum and the Interindustry Economic Research Fund, Inc. The retail and wholesale sectors are driven by consumer spending, along with expenditure by businesses and government. A factor that may limit consumer spending is higher tariffs on consumer goods. On a positive note, lower inflation supports a moderate increase of real disposable income by about 2% in 2025 and 1.9% in 2026. Real income could suffer to an extent if average prices rise due to tariff implementation. The forecast said retail spending could soften with the growth of spending on consumer services but noted that consumers so far have maintained spending on goods even as spending on travel and live entertainment has risen.
• Consumer confidence levels fell in March 2025 month over month, dropping by 7.2 points to 92.9, according to the Consumer Confidence Index from the Conference Board. Stephanie Guichard, Senior Economist of Global Indicators at The Conference Board, noted that the segment driving March’s decline was consumers over 55 years old, and the decline spanned all income groups with the exception being households earning over $125,000. Per Guichard, “Consumer confidence declined for a fourth consecutive month in March, falling below the relatively narrow range that had prevailed since 2022.” Purchasing plans for homes and new cars declined while big-ticket purchases rose on a six-month moving average basis, which may reflect plans to purchase certain items before impending tariffs lead to price increases.

• According to the Global Port Tracker report from the National Retail Federation (NRF) and Hackett Associates, import cargo at major US container ports is expected to drop dramatically at the beginning of May and fall at least 20% in the second half of 2025, year over year, due to tariff turmoil. Following tariffs on goods from China, Canada, and Mexico set earlier this year, the Trump administration has set a minimum tariff of 10% on all US trading partners and reciprocal tariffs on dozens of nations. Trump has since announced additional tariffs on China, bringing the rate on imports of Chinese goods to an estimated 145%. Jonathan Gold, NRF VP for Supply Chain and Customs Policy, said retailers are expected to pull back on imports and rely on built-up inventories for the near future, noting, “Retailers have been bringing merchandise into the country for months in attempts to mitigate against rising tariffs, but that opportunity has come to an end with the imposition of the ‘reciprocal’ tariffs.” Tracker data showed that US ports handled 2.1 million 20-foot equivalent units in March 2025, which was up 11.1% year over year.
• Businesses are finding a shortage of small warehouses to lease, resulting in some companies renting temporary storage units to fill in the gap, according to a recent report in the Wall Street Journal. The report cited Cushman & Wakefield data that showed the vacancy rate for US warehouses under 100,000 square feet as 3.8% in the fourth quarter of 2024 compared to the 6.7% overall vacancy rate. One factor creating the issue is a focus by developers on the construction of big buildings for growing ecommerce operations. Only 8% of the new warehouses built in 2024 were less than 100,000 square feet, a size that typically is less profitable for developers. Meanwhile, many companies are seeking smaller warehouses to lower costs and reduce their footprints. Some firms want smaller warehouses to better distribute their inventory closer to customers, which can speed up delivery and cut shipping costs.