The gain in February receipts at service stations was the biggest since August and followed a 0.7% advance in January. Regular gasoline at the pump averaged $3.67 a gallon in February, up from $3.32 the prior month. The Commerce Department’s retail sales figures aren’t adjusted for inflation.
Spending increased 0.2% at clothing chains and 0.5% at general merchandise stores, which was the most in almost a year, today’s report showed. Non-store retailers saw a 1.6% gain in purchases.
Sales excluding autos, gasoline and building materials -- the figures used to calculate gross domestic product -- climbed 0.4% after a 0.3% increase in the previous month.
Gains in demand weren’t universal, as department store receipts fell 1% in February. Same-store sales for 20 companies tracked by Retail Metrics Inc. rose 1.9% in February compared with a year ago, less than the 2.5% forecast. Sales at six of 12 chains reported gains, led by apparel stores including Gap Inc. and Limited Brands Inc.
Retailers took on almost 24,000 new employees last month, contributing to a 236,000 increase in payrolls that exceeded the median forecast of economists surveyed, figures from the Labor Department showed last week. The unemployment rate unexpectedly dropped to a four-year low of 7.7%.
The pickup in hiring defied concern that budget battles in Washington would hurt the economic expansion.
A fiscal pact passed by Congress on Jan. 1 gave a permanent tax break to 99% of Americans while allowing a payroll tax used to finance Social Security rise to 6.2% from 4.2%. A worker earning $50,000 a year is taking home about $83 less a month because of the higher levy.
Wrangling over the deal forced the Internal Revenue Service to delay accepting and processing 2012 tax returns, which is slowing refunds. Through March 8, taxpayers had received $159 billion in IRS refunds in this fiscal year, compared with $178.3 billion at the same point last year, according to Treasury Department data.
Costco, the largest U.S. warehouse-club chain that yesterday reported a 39% gain in second-quarter profit, has worked to lure more shoppers to its annual memberships by lowering already-discounted prices. Sales during the period at stores open for more than a year climbed 5%, excluding changes in gas prices and foreign-currency exchange rates.
Some discount and department-store retailers including Wal- Mart Stores Inc. have struggled to boost sales as the tax increase and delayed tax returns take a toll. Wal-Mart, the world’s largest retailer, said Feb. 21 that same-store sales in the first quarter will be little changed. Target Corp., the second-largest U.S. discount chain, said February sales got off to a slow start.
“Given these new challenges facing an already-sluggish economy, we have a tempered view of the near-term sales environment,” Target Chief Executive Officer Gregg Steinhafel said on a Feb. 27 call with analysts. “While there are some encouraging signs in the housing markets, volatility and consumer confidence, the payroll tax increase and rise in the price of gas all present incremental headwinds.”
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