2001 Ends With Worst Holiday Shopping Season in a Decade

Sales at U.S. chain stores fell in the last retail week of 2001, concluding what analysts said was the worst holiday shopping season in a decade and suggesting weakness could persist in the new year, two reports showed Tuesday.

Given the lackluster sales results seen over the holidays, consumer spending--which accounts for two-thirds of U.S. economic activity--is unlikely to lead the troubled U.S. economy out of a recession that now is entering its 11th month, analysts said.

The Bank of Tokyo-Mitsubishi and UBS Warburg said their retail chain store sales index slipped 0.6% during the week ended Jan. 5, after a 0.9% rise a week earlier.

Separately, Instinet said its Redbook retail sales average fell 3.5% in the five weeks ended Jan. 5, compared with the previous period.

December provided a five-week shopping month for the nation’s retailers.

Soft sales have begun translating into job losses for workers at major retailers.

Target Corp., one of the country’s largest retailers, said Tuesday that it will cut full-time employees who stock shelves and unload merchandise at its Marshall Field’s department store unit.

Other retailers, including Gap Inc., Nordstrom Inc. and Sears, Roebuck & Co., hurt by the economic downturn have laid off employees.

In a sign of resilience, two major jewelers Tuesday reported results that offered some signs of recovery in the luxury goods sector, which has suffered as consumers curbed spending in the aftermath of the Sept. 11 attacks.

Zale Corp., North America’s largest specialty jeweler, said sales at stores open at least one year, a key indication of retail performance, rose 1.8% in November and December as it sorted out inventory and merchandising problems.

Tiffany & Co., which focuses on affluent consumers, said its same-store sales for the period were down 2%, a decline analysts said was less steep than expected as traffic picked up later in the holiday season.