Retail sales fall by 2.1% in year to May
Consumers are still reluctant to spend their money, according to new figures showing the volume of retail sales down by 2.1% in the year to May.
However, new figures from the CSO show there was a slight increase - 1.3% - in the month.
But once motor sales are removed the volume of retail sales fell by 5.1% when compared to May 2010, with a monthly decrease of 0.6% for May.
It comes as the motor scrappage scheme is set to wind up tomorrow.
Hardware, paints and glass sales dropped by almost 14% in the year, with fuel down by almost 10%.
“These new figures for May illustrate just how difficult trading conditions are for retailers in Ireland," said Retail Ireland Chief Executive David Fitzsimons.
"May was the 39th consecutive month of declining sales for the retail industry.
“This simply dire retail industry performance is a clear indication of the urgent Government intervention required to reduce retail industry costs," Mr Fitzsimons added.
"Weakened consumer sentiment, job insecurity and interest rate increases have negatively impacted on consumer spending, leaving retailers with no option but to further reduce business costs to stay in business.
"Increased consumer spending will not return in the short-term, hence retail operators will only survive and recover through aggressive cost rationalisation."
Employers' group IBEC called for greater clarity from Government on future new taxes and charges to address consumer uncertainty.
"Obviously external factors such as the euro zone debt crisis are worrying shoppers, but Government must try and focus on the factors within its own control," commented IBEC chief economist Fergal O'Brien.
"It is vital that there is greater clarity for householders around the issue of new taxes and charges."
The Irish Small & Medium Enterprises Association (ISME) called on the Government to establish a retail strategy group to address the issues impacting on the sector, particularly the rising costs to business.
“Today’s figures confirm that retail sales volumes are down almost a quarter since 2007, with the sector in ‘freefall’ unless drastic action is taken to arrest this decline," said ISME Chief Executive Mark Fielding.
“It is high time that the Government took the threat to one of the most significant contributors to the economy more seriously.
"We need the immediate formation of a retail strategy group to address the risks to the sector and recommend immediate policies to tackle the cost base, in order to secure the remaining 250,000 jobs in the retail industry."
