Byline: Kristi Ellis

WASHINGTON — In the wake of the devastating terrorist attacks on the country last month, plummeting consumer confidence led to the largest monthly decline in apparel and accessories store sales since government tracking began in 1967.
Sales at apparel and accessories stores plunged a seasonally adjusted 5.9 percent to $13.36 billion in September, the Commerce Department reported Friday. Compared with September 2000, the decline deepened to 6.6 percent. Overall, retail sales dropped 2.1 percent to $260.66 billion in September.
“This is the worst [overall] retail sales report in 10 years,” said Michael J. Donnelly, a senior economist at The WEFA Group. “We all knew it was going to be bad, but not this bad.”
He said “psychological” purchases such as clothing and accessories fell the sharpest.
“Until the consumer feels more confident about the terrorist acts — and that hasn’t shown up yet — there will be more of the same,” he said.
Donnelly added that additional layoffs, which he expects to continue into next year, will lead to diminishing consumer confidence levels.
“People are not willing to spend that much if they get laid off or if someone they know gets laid off,” Donnelly said. “The economy was heading south before the attacks, and now it is heading into a recession. It’s not a good atmosphere for retailers right now.”
Rosalind Wells, chief economist at the National Retail Federation, said, “No one went shopping for many days following Sept. 11,” noting that discretionary items, including apparel, and luxury items performed the worst, while discounted apparel held up better.
“Even when people went back to shopping, they were reticent to spend a lot of money and they were looking for good deals and flocked to discounters,” Wells said. “That trend will continue for a while because the economy is weak and consumers are still worried about jobs.”
Department-store sales, excluding leased departments, declined 1.6 percent in September to $19.3 billion. General merchandise store sales dipped by 0.4 percent last month to $34.8 billion.