How has online shopping changed the retail industry?
The retail industry makes up 6.3% of GDP, and 16% of retail sales happen online.
At the turn of the century, only $0.90 of every $100 spent Americans spent on retail items was spent online. In 2024, that average was $16.10.
Now, nearly a quarter of the way into the 21st century, the internet has transformed industries in all sectors of the economy, and retail is no exception.
What percentage of shopping happens online?
In 2024, Americans spent $1.2 trillion on online retail, or a record 16.1% of the $7.2 trillion spent on retail overall. This is nearly two percentage-points higher than 2022, when 14.4% of retail sales happened online.
Online sales have reached record highs as a share of all retail.
E-commerce retail sales as a percent of total sales, 2000–2024
Online retail has grown steadily as a share of overall retail throughout the 21st century, spiking by nearly four percentage points from 2019 to 2020 during the pandemic. The share briefly dipped in 2022, but is currently higher than ever.
How big is the retail industry?
As of 2024, the retail trade industry made up 6.4% of US gross domestic product (GDP), which measures the total economic output of all industries in the US.
Retail trade makes up 6.3% of US GDP.
Share of US gross domestic product by major industry, 2024
This share has been relatively consistent since 1997 — retail has grown to no more than 6.9% of the GDP (in 1998) and shrunk to no less than 5.7% (from 2009–2012).
While retail has largely kept pace with changes in the US economy, other industries have surpassed it in share of GDP since the late 1990s. In 1997, retail was the fourth-largest major industry in the US after manufacturing, real estate, and state and local government. In 2024 it ranked seventh, having been eclipsed by professional services, healthcare and social assistance, and finance and insurance.
How big is the online retail industry?
Another way to measure an industry’s size is by how many people it employs. The retail industry employed 16.3 million people in 2024, up 7% from a 2010 low following the Great Recession.
But retail employment doesn’t always grow consistently: some sectors of the industry have been growing while others have shrunk. Employment with motor vehicles and part dealers rose 24%, dealers of building materials and supplies 23%, gas stations 19% and non-store retailers — which include a range of sales points from vending machines to online retailers — 9%. Other sectors, like electronics and appliances, have seen drops.
Growth in retail employment has varied by subsector.
Change in employment by retail industry subsector, 2010 to 2024
Since non-store retailers like ecommerce firms also tend to be more efficient than other retailers as measured by worker output — that is, they are capable of producing more with the same number of employees — it can also be helpful to measure the industry in terms of output rather than (or in addition to) employment.
The overall retail industry produced $7.4 trillion in sales in 2024, a 40% increase (after adjusting for inflation) since a recent low in 2009. Non-store retail was responsible for $1.5 trillion of that, or 20%. Since 2009, no subsector of retail has seen as much sales growth as non-store retailers: 223%. The next-highest sales growth was in motor vehicles, at 65%.
Non-store retail sales have grown the most since 2009.
Sectoral output of retail industry subsectors, inflation adjusted (2024 dollars)
Read more about the retail industry, holiday shopping, and get the latest data by signing up for our weekly newsletter.
