Retail sales in Spokane had a slow start in 2025, with low single-digit percentage growth, says Patrick Jones, executive director of Eastern Washington University’s Institute of Public Policy & Economic Analysis.

According to Washington State Department of Revenue data, Spokane County’s taxable retail sales totaled just under $4 billion in the second quarter of 2025, up 2.8% from the same period a year earlier. Retail trade makes up nearly half of that total, at $1.9 billion.

“For the last two quarters, or the first half of the year, we’ve largely been matching the state average," Jones says.

The state's second-quarter taxable retail sales increased 3.4% compared with the year-earlier quarter.

“That’s not bad," he says. "The 15-to-20-year average is between 4% and 5%.”

Jones notes that taxable retail sales figures include more than traditional retail activity, and include figures from the construction industry and the accommodation and food services industry. 

Statewide year-over-year retail growth also has remained in the low single digits this year, and Jones says he expects Spokane to follow that trend. 

“We’re, for the first half of the year, basically muddling along with very low single-digit growth percentages, but there still has been growth,” he says.

Though tariffs have been widely discussed in 2025, Jones says their effects haven’t fully impacted the retail sector yet.

“The tariffs, in a sense, haven’t hit too much,” he says. “Most forecasting economists think that the tariffs really haven’t made their full impact through the economy. They are saying that they will in 2026.”

He points to the automobile sector as being among the most vulnerable.

“Cars are going to be near the top of that list of those industries that will be affected,” he says. 

National economic trends, he says, are shaping the regional environment as well. 

“There’s kind of a tale of two economies, and that applies to retail trade,” he says, referencing recent reporting on the K-shaped recovery — an uneven economic rebound where some groups flourish and others decline or stagnate. Higher-income households continue to spend freely, he says, supported by strong stock-market gains and rising salaries, while lower-income households face tighter budgets.

“Let’s say the top 20% of the income distribution is very, very robust, little constrained by price,” he explains. “And then you have the spending of the bottom quintile, … families have been very restrained in their spending because they’ve been hit by rising prices that are rising faster than their incomes.”

As a result, Jones predicts that retailers that cater to lower- to middle-income households are going to face more challenges than those that cater to higher income families.

Despite affordability challenges, certain retail segments are expected to continue to perform well.

“Costco has been strong, and I think online has been strong,” he says.

Home-improvement retailers, including Home Depot and Lowe’s, have slowed somewhat, he adds. 

Bryn West, vice president of leasing and operations for Cowles Real Estate, a subsidiary of Cowles Co., says River Park Square is entering 2026 with solid momentum.

“We saw year-over-year growth again,” she says. “With the traffic we’re seeing at River Park Square, we anticipate another slight increase over last year. It’s clear that the consumer is still out there and still shopping.” 

Despite the convenience attached to e-commerce, West says in-store shopping remains dominant.

“Most of the data that we look at shows that the majority of transactions are actually still made in a physical store — like up to 80%,” she says. “We hear about all of these online shoppers for Black Friday or Cyber Monday, but there is still the lion’s share of transactions still occurring within brick-and-mortars.”

River Park Square is fully leased going into the holiday season, she adds.

“We are full … over the holiday season, which is fantastic,” she says, noting that many stores at the shopping center are long-term tenants dating back to the mall’s 1999 rebranding.

Movie releases are helping boost foot traffic as well, with strong box-office results from Wicked: For Good and Zootopia 2 driving consumers to the mall. West also sees opportunity for the jewelry sector to expand.

“Jewelry is really poised for strong growth next year,” she says.