WASHINGTON — Sales at department stores helped drive top-line growth in retail sales in August, but consumers pulled back on spending at apparel and accessories stores and discounters, the monthly retail sales report released by the Commerce Department showed on Friday.
Department stores showed the only sign of strength, posting a seasonally adjusted 0.6 percent gain in sales to $14.4 billion in August. Sales at apparel and accessories stores fell a seasonally adjusted 0.8 percent last month to $20.9 billion, while sales at general merchandise stores, a category that includes discounters and department stores, fell 0.2 percent to $54.7 billion in August.
On a year-over-year basis, specialty store sales were 3.6 percent higher than in August 2012, while sales at general merchandise stores were 0.3 percent lower. Department store sales were down 5.3 percent compared with a year earlier.
In the overall economy, retail sales grew 0.2 percent in August to $436.6 billion, with large gains in motor vehicle and parts, furniture, electronics, department stores and restaurants driving retail sales.
“This is not a good report,” said Chris G. Christopher Jr., director of consumer economics at IHS Global Insight. “In August, consumers pulled back after making a comeback in July.”
As a result, IHS has slightly lowered its consumer spending outlook for the third quarter and “considerably lowered” its back-to-school outlook, Christopher said. IHS lowered its b-t-s retail sales forecast, which is not seasonally adjusted, to an increase of 2.5 percent over last year. Its previous forecast showed a 3.2 percent increase over last year.
“The summer ended on a sour note for many retailers; however, a modest pickup in September is expected,” Christopher said.
Scott Hoyt, director of consumer economics at Moody’s Analytics, said consumer spending growth is rising faster than income growth.
“Consumers are struggling right now because income growth is very weak,” Hoyt said.
“Clothing and accessories store sales were down 0.8 percent in August after being up 1 percent in July. General merchandise store sales were down 0.2 percent in August after being up 0.2 percent, and department store sales were up 0.6 percent after being down 0.4 percent. Across all three of these segments, you average out to flat growth,” Hoyt said.
The National Retail Federation said retail sales increased at a much slower pace in August than was anticipated.
“Retail sales gains continue to be tepid,” said Jack Kleinhenz, chief economist at the NRF. “Retail sales and employment, while measurably positive, have been disappointing over the last few months, and have been difficult to reconcile with consumer confidence. The data suggests that consumers remain cautious with their pocketbooks and purchases.”