Retailers report sluggish July sales

NEW YORK -- American shoppers — worried about job security and finding fewer options among the sales bins — remained tight-fisted in July, resulting in sluggish sales for many merchants and raising concern about the back-to-school shopping season's health.

"The consumer is stressed and depressed," said Ken Perkins, president of retail consulting firm Retail Metrics. "Back-to-school shopping season is going to be very late." He added that jobs are "everything right now," and if the pace of job losses continues to slow, consumers will start to feel better.

A number of special factors also depressed July's sales results. Lean inventories left fewer clearance options for bargain hunters, as stores wanted to protect themselves from getting stuck with piles of leftovers. The shift of the sales-tax holidays from July to August in most of the 14 states that have them because of a late Labor Day weekend also stole momentum from July.

Frank Badillo, senior economist at consulting group TNS Retail Forward, and other analysts have also noted that the uptick in car buying spurred by the government's "cash for clunkers" program might siphon sales from other categories like clothing and home furnishings in coming months. That could hurt back-to-school shopping as consumers shift available cash to car payments.

According to an early tally by Reuters, six retailers missed sales estimates and four beat estimates. The tally is based on same-store sales or sales at stores opened at least a year. Same-store sales are considered a key indicator of a retailer's health.