Analysis: U.S. retailers say uneven recovery keeps consumers cautious
By Phil Wahba and Lisa Baertlein
(Reuters) - From Wal-Mart Stores Inc and Gap Inc to Macy's Inc and McDonald's Corp, chains that cater to middle- and lower-income Americans say they are feeling the pinch of an uneven economic recovery.
A host of retailers have reported tepid sales lately, highlighting the stress that consumers are feeling because of higher payroll taxes, expensive gasoline and a slow job market four years after the U.S. economy started to rebound.
"Everyone wants to talk about recovery - it's like the unrecovery," Susquehanna Financial Group analyst Bob Summers said following the Wal-Mart results. "The demographic that they cater to, not only has it not seen improvement, I would argue that things have gotten worse."
Look no further than Macy's for a snapshot of the consumer. For its namesake mid-tier department stores, Macy's reported the first decline in same-store sales in nearly four years this week, and said shoppers had been gravitating to its less expensive items. That's a contrast with Macy's upscale Bloomingdale's, which came in with strong results.
The trend also turns up in results posted on Thursday by Wal-Mart, which emphasizes low pricing. Its U.S. sales at stores open at least a year unexpectedly fell 0.3 percent last quarter, a second decline in a row, prompting the world's largest retailer to lower its sales forecast for the year.
Last week, a group of U.S. retailers including Costco Wholesale Corp and Gap reported modest gains in July same-store sales, thanks largely to bargains.
Adding to the pressure, Macy's said many shoppers are redirecting their spending to their cars, housing and home improvement.
Automakers reported a 14 percent U.S. sales increase in July from a year earlier, industry consultant Autodata Corp said. Continued...