Consumers may have been too preoccupied with “cash for clunkers” and their own job prospects to get too serious about back-to-school shopping in July.
U.S. chain store sales fell 5 percent last month, the 12th consecutive monthly decline, the International Council of Shopping Centers reported Thursday. A year ago, consumers armed with stimulus checks had helped produce a 1.3 percent increase.
Still, retail stocks were mostly up Thursday as several chains displayed cost controls, leaner inventories and more evidence that they’re toughing out the recession.
Sales were generally down but better than expected in some cases, and inconclusive about whether shoppers will spend freely or frugally in the months ahead.
Retailers look to back-to-school – the industry’s second-biggest sales period – for clues about their biggest season: Christmas.
“Shoppers are not yet ready to spend freely,” said Frank Badillo, senior economist at Retail Forward. “But the results reported by retailers provide some signs that shoppers are easing up on their cutbacks. And that’s especially encouraging given the variety of factors weighing on retail sales in July.”
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Retail Forward’s monthly ShopperScape survey is showing a gradual trend of fewer shoppers saying they plan to spend less, 47 percent in July vs. 55 percent in January.
Concerns about job security, personal income, shifts of many states’ annual sales-tax holidays from July into August and a potential drain of discretionary dollars from cash for clunkers contributed to another difficult month for U.S. retailers, said Ken Perkins, an analyst at RetailMetrics Inc.
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