Tumbling Retail Sales Raise Concerns About Strength of Recovery

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PR Newswire | 12 Jun, 2010
ARLINGTON: Monthly retail sales figures released today by the Department of Commerce showed the largest decline since September 2009, raising concerns about the strength of the economic recovery and the pace of long-term economic growth, noted the Retail Industry Leaders Association (RILA).

Overall retail sales declined 1.4 percent in May from the previous month but rose 6.1 percent over sales in May 2009. Retail sales excluding auto and auto part sales slipped 1.1 percent in May, but exceeded May 2009 sales by 6.1 percent.

"Retailers have long recognized that it may be a long uphill climb to full recovery, but today's report suggests the climb may be steeper than we thought," said RILA President Sandy Kennedy. "As an industry, we are clearly in a better position today than we were a year ago; however, consumers remain cautious. Until the overall economic news improves and those Americans out of work find employment, meaningful retail sales growth will be difficult to achieve."

Steep market declines last month, may have caused consumers to close their wallets once again. Building material and department store sales faced the steepest declines in May, dropping 9.3 percent and 1.8 percent, respectively. Meanwhile other retail segments remained relatively flat.

Today's retail sales follow last weeks' news from the U.S. Department of Labor that just 41,000 private-sector jobs were added to the economy last month.

"Retailers will continue to adjust to the ebbs and flows of the recovery to meet customer needs and utilize strategies that will provide a launching pad for success as the economy regains its strength," added Kennedy.

RILA is the trade association of the world's largest and most innovative retail companies. RILA members include more than 200 retailers, product manufacturers, and service suppliers, which together account for more than $1.5 trillion in annual sales, millions of American jobs and more than 100,000 stores, manufacturing facilities and distribution centers domestically and abroad.