Byline: Alison Maxwell

WASHINGTON — Apparel sales throughout much of the country were sluggish from December through February, but retailers predicted strong spring sales, according to the latest survey of business conditions released Wednesday by the Federal Reserve.
The report, known as the “beige book,” has retailers in regions from New York and Boston to Minneapolis and Dallas reporting overall strong retail sales and extremely tight labor markets.
In New York, apparel sales were slow, while home goods, ranging from electronics and appliances to bedding, continued to be hot sellers. Retailers indicated that sales were on or ahead of plan in early- to mid-February. Major chains reported that same-store gains ranged from 3 to 7 percent compared to last year. Contacts predicted that the elimination of sales tax on apparel and footwear as of March 1 would have little impact on sales. Retailers in Boston reported sales growth in the upper single-digit range for the December through mid-February period. Retailers said base wages are increasing at a 3 to 5 percent rate. Looking toward the second half of the year, contacts predicted a moderation in the rate of growth in consumer spending.
In Philadelphia, retailers reported strong sales gains over last year. Cold weather boosted sales of winter outerwear and helped specialty and department stores reduce stocks without heavy markdowns. Contacts predicted strong spring apparel sales.
Cleveland retailers reported slower sales due to inclement weather. Expectations for spring were positive, with most retailers predicting moderate to strong sales increases, overall.
In Richmond, winter storms slowed retail traffic in January, but sales picked up in February. Retailers trimmed workforces in February, but modest upward wage pressures persisted.
In the Atlanta area, retail sales were strong from December through February, but February was not as strong as expected. Sales of children’s apparel, jewelry, and home-related products were strong, while sales of men’s and women’s apparel varied across stores.
Retail sales in Chicago were robust because of high consumer confidence, contacts said. Labor markets in the area were much tighter than for the nation as a whole, and employers struggled to find and retain workers.
St. Louis region contacts reported strong economic conditions, with several expansions leading to job growth. Wal-Mart is opening its largest supercenter in Arkansas this fall, and will also add 250 employees at a Western Kentucky store. Otherwise, district employers reported difficulty hiring and retaining qualified workers.
Retailers in Minneapolis were optimistic about current and prospective sales. A major Minneapolis-St. Paul-based discount and department store retailer reported a 5.7 percent increase in same-store earnings over last year for January.
In Kansas City, sales of winter clothing and men’s formal wear were weak, while men’s sportswear and cosmetics sales were strong. Labor markets were tight and entry-level workers were hard to find.
Retailers in Dallas reported continued strong sales, while Houston-area sales picked up after posting slower sales growth compared with the rest of Texas. In San Francisco, sales were strong, but contacts said apparel inventories were building up.

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