Oklahoma Monthly Retail Trade - Documentation
The Center for Economic and Management Research (CEMR) Price College of
Business, The University of Oklahoma produces the Oklahoma Monthly
Retail Sales Series containing monthly estimates of retail sales for Oklahoma,
the Oklahoma City, Tulsa and Lawton Metropolitan Statistical Areas and 48 selected
cities in Oklahoma.
Estimates published for the State and metro areas are available by kind of
business categories. Estimates published for selected cites are total retail
sales only. The series runs from March 1988 to current for the state, Lawton
Metropolitan Statistical Area and all selected cities. The series runs from
March 1999 to current for the Oklahoma City and Tulsa Metropolitan Statistical
Kind of Business Classification Establishments are assigned industry
classifications according to their primary types of economic activity.
Those establishments engaged primarily in selling merchandise for personal or
household consumption are designated as part of the Major Industry Group
"Retail Trade" and are assigned an industry classification code
according to definitions provided by the
North American Industry Classification System (NAICS).
Aggregations for the Oklahoma Monthly Retail Trade Series are made as
Lumber, Hardware and Other Building Materials
Automotive Repair, Service and Accessories
Computer, Electronic and Music Stores
Used Merchandise Stores
General Merchandise Stores
Eating and Drinking Places
Misc. Non Durable
Retail Stores, Not Elsewhere Classified (NEC)
The series is based on sales tax collection data provided by the Business Tax
Division, Oklahoma Tax Commission (OTC). The data provided includes tax receipts
(monthly sales tax collections) by establishment, type of business, and
Several issues should be considered when using the information provided in this
1) The information provided by OTC includes
not only current month tax collections (resulting from actual sales in that
month) but also collections from any late reports or penalty payments from
previous months. This has the unwanted effect of introducing month-to-month
variations in tax collections not associated with actual sales from the business
month. The method used to minimize this variation is discussed below.
Automobile sales, which are not subject to sales tax in Oklahoma, are not
Caution should be exercised in interpreting changes in the series for any
particular area. A change in the series simply means that the level of
retail sales has changed. It does not necessarily imply changes in other
economic indicators. For example, sales may decline even though individuals in a
city may be earning as much as they were previously. Individuals may
simply be growing more cautious in their expenditures. However, this is
the kind of situation that bears watching because, in general, sales tend to
fluctuate less than personal income.
It should also be noted that changes in the series can reflect changes in
regional spending patterns rather than a general deterioration in economic
conditions. For example, a new highway which makes it easier to shop in a larger
city may reduce local purchases even though income in the region remains the
Despite these qualifiers, the information presented in this report should prove
useful for persons interested in economic performance. The data are the most timely
when used in conjunction with other economic indicators, provide an informative
picture of local economic conditions.
All sales tax collections from non-retail establishments (primarily wholesale
taxes) are eliminated from the data set provided by OTC. Sales tax
collections are next sorted according to their business classifications using
Standard Industrial Classification (SIC) Codes.
Sales subject to sales tax are then estimated by dividing collections by the
appropriate area's sales tax rate. For example, suppose a city raised $10,000 in
sales tax collections in a particular month. If the city's sales tax rate is 2.0
percent, then the dollar value of the sales subject to city sales tax would have
equaled $500,000 during that month.
Since month-to-month changes in retail sales are not meaningful unless the
normal seasonal variation is removed, our preliminary estimates are next ôseasonally
adjusted." This permits examination of the "real" month-to-month
changes unaffected by normal seasonal trends.
An example of normal seasonal variation is the increase in sales associated with
the Christmas holiday. Assume the average rate of increase in General
Merchandise sales between November and December was 20 percent over the last
five years. Next assume that the change in General Merchandise between November
1994 and December 1994 was also 20 percent. The seasonally adjusted data for
December 1994 would show no increase for December 1994 because the seasonal
trend--in this case the Christmas holiday season--has been removed.
CEMR uses a statistical process commonly referred to as the "X-11"
program to seasonally adjusted retail sales estimates. The program was developed
at the U.S. Bureau of the Census.
Central Averaging Following this procedure, an effort is made to remove
variation in the data produced by tax collections in a given month not resulting
from actual sales in that month, i.e., late payments, penalty payments, etc.
This is accomplished using a statistical technique known called Centered
Past series of retail estimates were "benchmarked" to the Census of
Retail Trade. In other words, the Census was used as a base year and percent
changes in sales tax collections were used to move that base figure forward in
time. It was decided to abandon this method after close investigation revealed
that the method used by the Census to assign business classifications was
inconsistent with the method employed by the Oklahoma Tax Commission.
Once these steps are completed, the categories are next aggregated either a
Total Durable or Total Nondurable category.
Gasoline Sales Estimates Sales of gasoline and motor fuels are not
subject to sales tax but rather an excise tax. Monthly gasoline sales are then
estimated by dividing the excise tax collection data by the excise tax rate.
New seasonal factors are computed annually for the entire series to adjust for
seasonal variations as well as trading day and holiday differences. The seasonal adjustment program used to generate the
seasonal factors is X-11.
For additional information on the Oklahoma Monthly Retail Trade Series, contact:
Center for Economic and Management Research
Michael F. Price College of Business
The University of Oklahoma
307 W. Brooks
Norman, Oklahoma 73019
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