WASHINGTON — Consumers shaken by volatility in the stock market and the contentious debate in Congress over the nation’s debt pulled back on spending in August, pushing down sales at specialty and department stores.
Sales at clothing and accessories stores fell a seasonally adjusted 0.7 percent to $18.7 billion in August compared with July, while sales at department stores dropped 0.3 percent to $15.3 billion, according to a Commerce Department report Wednesday.
General merchandise stores, which include discounters and department stores, managed to gain a little ground, posting a 0.1 percent increase to $52.8 billion.
“When you look at Macy’s, Nordstrom and Saks, they are the three biggies, and they are more affluent, customer-related department stores, and they are doing well, whereas a [J.C.] Penney is struggling and Kohl’s has disappointing numbers,” said Kevin Regan, senior managing director at FTI Consulting. “To me, moderate consumers are being more cautious and probably stretching the dollar more and only spending if they have to.”
Regan said he was not surprised by the decline in retail sales, because several macro issues are “haunting consumers.”
“Whether it’s housing [prices falling], unemployment or stagnant incomes, these are things that continue to remind people we are not out of the woods,” he said.
Hurricane Irene, which slammed the East Coast late last month, also affected consumer behavior and showed up in the retail sales, he said.
In the overall economy, retail sales remained flat in August, at $389.5 billion, falling below economists’ expectations of a 0.2 percent increase.
“August’s retail sales are pointing to an economy that has stalled,” said Chris G. Christopher Jr., senior principal economist at IHS Global Insight. “Clothing, department stores and restaurants fell for the second month in a row. This is pointing to a very weak back-to-school shopping season and a consumer that is facing strong headwinds.”
Despite the weak sales in August, the S&P Retail Index perked up 1.7 percent, or 8.49 points, to 516.52, as the Dow Jones Industrial Average rose 1.3 percent, or 140.88 points, to 11,246.73.