Sales at U.S. retailers fell less than anticipated in September, a sign households will play a greater role in the emerging economic recovery. The 1.5 percent decrease in purchases followed a 2.2 percent gain the prior month, figures from the Commerce Department showed today in Washington. Sales excluding automobiles climbed 0.5 percent, more than the median forecast of economists surveyed by Bloomberg News. The broad-based improvement indicates Americans are becoming more confident that the economy is recovering even as job losses persist. The report helps ease concern consumers will retrench as government stimulus, such as the “cash-for- clunkers” plan, fades and joblessness mounts. “Consumers are back spending,” Christopher Low, chief economist at FTN Financial in New York, said before the report. “We’re likely to see unexpected strength in consumer spending through the end of the year. At some point we need to transition from government spending to consumer spending and hopefully, this’ll be the beginning.” Retail sales were projected to drop 2.1 percent after an originally reported 2.7 percent gain in August, according to the median estimate of 78 economists in a Bloomberg News survey. Forecasts ranged from declines of 0.6 percent to 4 percent. Excluding automobiles, sales were forecast to increase 0.2 percent, according to the survey median. Sales at automobile dealerships and parts stores plunged 10 percent, the most since August 2005, after the Obama administration’s incentive program expired. Purchases in August jumped 7.8 percent. ‘Clunkers’ Plan The government program allowing consumers to trade in older models for new, more fuel-efficient ones ended Aug. 24, translating into a 35 percent drop in auto sales last month, industry figures showed earlier this month. General Motors Co., Toyota Motor Corp. and Ford Motor Co. posted declines. Outside of autos, only three of the other 12 categories showed a drop in sales last month, building on the broad gains seen in August, when purchases in every category except one climbed. The gains last month were lead by furniture stores, which showed a 1.4 percent jump in sales, the most since January 2007. Purchases at department stores climbed 0.4 percent, grocery stores showed a 0.9 percent increase and clothing stores were up 0.5 percent. Influence on Growth Excluding autos, gasoline and building materials -- the retail group the government uses to calculate gross domestic product figures for consumer spending -- sales increased 0.5 percent after a 0.7 percent increase in August. The government uses data from other sources to calculate the contribution from the three categories excluded. Consumer-spending gains in the coming months “likely will be muted,” given a “quite weak” labor market and “subdued” increases in income, Fed Vice Chairman Donald Kohn said yesterday in a speech to economists in St. Louis. The risk of slowing inflation will exceed the chance of accelerating prices “for a while,” he said. Retailers’ results last week showed discounts are driving purchases. Sales at stores open at least a year climbed 1.1 percent in September from the same month in 2008, the first year-over-year increase in 13 months, said Swampscott, Massachusetts-based Retail Metrics Inc. Menomonee Falls, Wisconsin-based Kohl’s, the fourth-largest U.S. department-store chain, raised its profit forecast for the third quarter after comparable sales rose, defying projections of a decrease. Framingham, Massachusetts-based TJX, owner of T.J. Maxx and Marshalls stores, also reported a gain. Some Struggle At the same time, same-store sales declined at Macy’s Inc., the second-biggest U.S. department-store chain, and at Gap Inc., the owner of Gap, Banana Republic and Old Navy stores. “People will maintain more of a thrifty kind of approach to expenditures than they have in the past,” Arthur Blank, co- founder of Home Depot Inc., said in an Oct. 8 speech in Atlanta, where the largest home-improvement retailer is based. “It doesn’t mean they won’t spend their money. They’re just going to be more selective.” Job losses accelerated in September to 263,000, and the unemployment rate rose to 9.8 percent, Labor Department data showed this month. The economy has lost 7.2 million jobs since the recession began in December 2007, the most of any downturn since the Great Depression. The unemployment rate may exceed 10 percent by the first quarter of 2010, according to a Bloomberg survey taken from Oct. 1 to Oct. 8.

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