Retail sales showed some unexpected signs of life in November, boosting hopes for a fragile economic recovery.
The U.S. Commerce Department report released Friday stood in contrast to many chain retail reports a week ago of a weak holiday shopping launch. Consumer spending accounts for two-thirds of the economy, so many economists saw Friday's results as a sign the consumer "implosion" that set in a year ago is starting to reverse itself.
However, the gains, aided by an easy comparison to November 2008 when retail sales fell off a cliff, were still a fraction of the 4 or 5 percent seen in a healthy economy.
Compared with October, retail sales rose 1.3 percent last month, after a 1.1 percent gain from September. It was the biggest advance since sales rose 2.4 percent in August, and double the 0.6 percent increase economists forecast. Compared with November 2008, sales were up 1.9 percent.
This time most of the spending increase came from higher prices, lifting gas sales 6 percent. Car sales inched up 1.6 percent despite no lift from "cash for clunkers" incentives.
Retail sales gains were triple the 0.4 percent advance many economists expected. Without gas and autos, retail sales posted a respectable 0.6 percent rise.
"Our November results were reasonably good and ahead of where we thought we would be," said Steve Knopik, chief executive of Beall's Inc., a Bradenton chain that runs 80 department stores and 500 outlet stores. "Our outlets have been very strong as shoppers continue to respond to value."
With store inventories ratcheted down 8 to 13 percent below last year's Christmas holiday nightmare for merchants, stores hope they won't need to discount as deeply this season to stimulate sales and preserve profits.
"We've tried to create value by offering new innovations at a very compelling price," said Steve Light, senior vice president of tools for Sears, Roebuck & Co. "And we know more people will build their own deck rather than hire a contractor."
One of Sears' best sellers is a battery-powered, cordless auto-hammer at $99.99 that a year ago sold on TV infomercials for $300 or more. The tool department grouped gifts priced under $10, $20, $50 and $100.
The department's most visible aisle is lined with sharply priced wrench sets for practical do-it-yourselfers who work on their own cars or home improvements.
Economists and retailers doubt consumers will loosen purse strings much further as long as double-digit unemployment persists and the economy struggles to emerge from the worst recession since the 1930s.
In November, sales at department stores increased 0.7 percent from October, and the broader category that includes discount stores such as Wal-Mart Stores Inc. and Target Corp. posted a 0.8 percent increase.
Sales also jumped 2.8 percent at electronics and appliance stores, 1.5 percent at hardware stores and 1.2 percent at online retail sites.
Sales fell 0.7 percent at furniture and apparel stores.
Times wires contributed to this report. Mark Albright can be reached at firstname.lastname@example.org or (727) 893-8252.