Apparel spending slides in May: SpendingPulse

CHICAGO - Consumer spending on apparel and footwear slid during May as buyers scaled back on discretionary purchases amid a sluggish U.S. economic environment, according to a SpendingPulse report released on Wednesday.

May sales were down 1.1 percent versus May 2007, with women's apparel declining 5.4 percent and footwear decreasing 1.0 percent. Men's apparel posted a gain of 4.8 percent.

Those declines could continue as consumers are hammered by higher gasoline and food prices, a falling housing market and the U.S. credit crisis.

"I think you probably need to see consumer confidence numbers start to come up," Michael McNamara, vice president of SpendingPulse, said in an interview. "You have to see a general lift, I think, in the overall economy before some of these apparel numbers will start to have a more consistent rebound."

SpendingPulse is the retail data service of MasterCard Advisors, an arm of MasterCard Worldwide <MA.N>.

Women's apparel sales have been weak for several months, hurt by a combination of the weak economy and a lack of fashions that have motivated purchases.

Apparel prices increased in May about 2 percent compared with last year, and transactions were down 3 percent for the period, according to SpendingPulse.

McNamara said that it is difficult to gauge whether consumers will put their tax rebate checks to use on discretionary purchases instead of bills or gasoline.

"I would expect to see that impact would probably be more in June than in May since the checks just started to arrive," he said. "A lot of that depends on consumer confidence, especially confidence in their employment. If the employment numbers look shaky and people start to get worried about their jobs, they're more liable to save that extra money or pay down debt."

The SpendingPulse data is taken from the aggregate sales in the U.S. MasterCard payment network, coupled with estimates on all other payments including cash and check.