The latest Australian Bureau of Statistics (ABS) figures show that retail sales rose 0.2 per cent in May, seasonally adjusted, compared with a rise of 0.6 per cent the previous month.
The Australian Retailers Association (ARA) said the ABS figures meant more bad news for retailers who have been slashing prices to get consumers through the door all year.
ARA deputy executive director Russell Zimmerman said year-on-year growth from May 2009 to May 2010 painted an even bleaker picture than the monthly sales growth released today.
"May 2010 retail sales are only up 1.2 per cent compared to the same time last year. This is not real growth – it is well below the current rate of inflation," Zimmerman said. 
"Fashion retailers as well as department stores posted the strongest monthly sales growth from April to May 2010. However, over a 12-month period sales have actually declined for these same retail categories at -3.6 per cent and – 5.8 per cent respectively, explaining the constant discount war between clothing retailers and department stores.
"It's a pretty depressing outlook for retailers when their income from sales is decreasing while their expenses from wage bills are increasing due to the first phase of the modern award transitions and new minimum wage starting today. Retailers are spending every waking hour trying to get customers in the door and hold onto staff,” said Zimmerman.
New South Wales (0.9 per cent) and Victoria (0.2 per cent) recorded increases in sales in May. Sales decreased in the other states and territories: South Australia (-0.9 per cent), the Australian Capital Territory (-0.6 per cent), the Northern Territory (-0.4 per cent), Western Australia (-0.3 per cent), Queensland (-0.2 per cent), Tasmania (-0.1 per cent).
Australian National Retailers Association CEO Margy Osmond was a bit more optimistic and said consistent growth in retail figures indicate retail is holding its head above water during tough months, which may be a sign the retail sector is beginning to recover.
“May was a tough month – consumer confidence dropped, there were concerns about the global economy and the budget was poorly received. Any growth is the source of some hope but we need to see what happens in June – which didn’t see an interest rate rise – to be confident of any recovery,” she said.
However, Osmond said normal growth is around six per cent per annum and the 12 months to May 2010 show growth of only 1.2 per cent (though the May 2009 period was boosted by cash handout spending).
“We have now had three solid months of growth in retail numbers – up 0.8 per cent in March and 0.6 per cent in April – and the trend continued through May. That’s the first time since the stimulus package in the first quarter of last year that we’ve had consistent growth.”
The June figures will also reflect ‘sale season’ as major department stores rolled out the sale signs early this year, with the hope of encouraging consumers back through their doors.