Retail sales fall in September

Retail sales continued to decline in September, new data from the Central Statistics Office showed today, with the volume of goods sold falling 0.8 per cent compared with the previous month.

On an annual basis, sales were 3.9 per cent lower.

The retail sector has been hard hit by falling consumer spending and weak domestic demand, as the difficult labour market and uncertainty over upcoming austerity measures prompt consumers to save money and pay off debt.

Excluding the volatile motor trade, volume declined by 0.2 per cent in September compared with August, and fell by 3.4 per cent compared with September 2010.

On a monthly basis, the hardest hit sectors were furniture and lighting, where sales were down by 4.2 per cent, and the motor trade, which declined by 3.4 per cent as the Government's scrappage scheme ended.

Sales of food and drink also fell, losing 2.8 per cent compared with the previous month. Sales of electrical goods rose by 2.7 per cent during the month.

The value of retails sales was also lower in September, falling by 0.6 per cent. On a yearly basis, that figure rose to a decline of 3.3 per cent.

"Today's report is very much consistent with an ongoing payback effect for prior buoyancy in car sales linked to the scrappage scheme which expired in June; motor trades sales volumes have fallen by 15 per cent since then according to the CSO, exerting downward pressure on the aggregate measure over the period," Ulster Bank economists said.

"Overall, it looks highly likely that consumer spending will have acted as a drag on overall economic growth in the third quarter."

The Irish Small & Medium Enterprises Association Isme called on the Government to reduce costs, warning that shops would continue to close, jobs will be lost and the sector would continue to "disintegrate" if Government-influenced costs were not tackled soon.