WASHINGTON — Retail apparel sales were driven by gains at apparel specialty stores and general merchandise stores in March, and department stores sales fell, the Commerce Department said Wednesday.
Clothing and accessories store sales increased a seasonally adjusted 0.6 percent compared with February to $18.9 billion, while sales at general merchandise stores, a category that includes discounters and department stores, rose 0.4 percent to $52.1 billion. But department store sales were down 0.2 percent to $15.4 billion for the month.
“I think moderate department stores are seeing less traffic because of rising gas prices,” said Kevin Regan, senior managing director and retail industry expert at FTI Consulting, pointing to “disappointing” same-store sales from such stores as Kohl’s Corp., Dillard’s Inc. and The Bon-Ton Stores Inc. “That is certainly going to continue down the road, even though we’ve had an improving job market.”
Matthew Shay, president and chief executive officer of the National Retail Federation, said consumers took advantage of retailers’ spring promotions in March, but said there is cause for concern.
“While current indicators point to a more confident consumer, increasing gas prices and a cramped job market could hamper consumer spending during the upcoming summer months,” Shay said.
Further compounding problems for merchants is that consumer prices are expected to rise 10 to 15 percent this spring and summer, particularly in the apparel and home furnishings sectors, which are grappling with high cotton and other raw materials prices, as well as rising transportation costs, according to a survey released Wednesday by Capital Business Credit.
Overall retail sales rose in March for the ninth consecutive month by 0.4 percent to $389.3 billion, fueled by a 16.7 percent increase sales at gasoline stations.
“The improving job market and increased household income are helping retailers considerably,” said Chris G. Christopher Jr., senior principal economist at IHS Global Insight.
The Federal Reserve’s Beige Book report, also released Wednesday, showed that retail sales in February and March were hampered by unseasonably cool weather and soaring commodity prices in some regions, but were boosted by promotions and discounts in others.
Retail sales remained weak in Richmond, but consumer spending was slightly up in all other regions.
“Consumers were shopping for necessities and looking for lower-priced options or promotional items in Boston, Chicago and San Francisco,” the report said.