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US footwear prices rise amid economic uncertainty

Nov 29, 2024 United States

Tariffs and inflation continue to shape US footwear pricing, as October data revealed mixed trends, with increased men's and children's footwear prices, while prices for women's shoes declined

“In particular, prices for children’s footwear rose for the first time in eight months and the fastest in a year and a half, stretching to a seasonally adjusted record high in October. Despite the October reading, we still look for children’s footwear prices to sink in 2024. Albeit moderately, this reverses three straight years of gains, likely to be only the second annual decline in the last fourteen years for children’s footwear prices”, commented Gary Raines, Chief Economist at the Footwear Distributors and Retailers of America (FDRA).

In October, footwear prices in the United States (US) experienced a modest increase, marking a 0.8% rise compared to the previous year, according to data from the FDRA. The price adjustments varied across categories, with men's footwear seeing the most significant hike of 2.8%, followed by boys' and girls' footwear at 1.6%. However, women's footwear prices deviated from the trend, falling by 1.2% over the same period.

The Bureau of Labor Statistics' Consumer Price Index (CPI) mirrored these developments, reporting a 0.2% monthly increase in overall inflation for October. Over the past 12 months, prices have risen by 2.6%, driven mainly by the core CPI (which excludes food and energy prices), showing a year-over-year increase of 3.3%. Despite stable inflation rates since July, the footwear industry remains vulnerable to additional pricing pressures.

Industry leaders have raised concerns about the long-term implications of these pricing trends. Steve Lamar, president and Chief Executive Officer at the American Apparel & Footwear Association, highlighted the persistent burden of tariffs on US footwear importers. Lamar warned that proposed tariff hikes could exacerbate price increases for consumers, further straining household budgets and potentially reducing demand in the sector.

The broader economic environment underscores these industry-specific challenges. While October's inflation figures suggest a stable trajectory, they also reflect entrenched cost pressures that continue to impact consumer goods. The 4.5 times higher duty rate paid by US footwear importers compared to other imports remains a significant factor in the sector’s pricing dynamics, with potential tariff escalations adding to industry uncertainty.

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