US retailers are reporting sharp sales declines for June, as continuing concerns about unemployment and rainy weather put a dampener on purchases of seasonal items such as air conditioners and summer clothes. Abercrombie & Fitch, the preppie fashion retailer, was among the biggest casualties with same store sales for June down by 32 per cent compared with June 2008.

Macy’s, the department store, reported a decrease of 9.1 per cent, to $2.05 billion, compared with last year, in the five weeks ended July 5, 2008. On a same store basis sales were down 8.9 per cent. The company said this was consistent with its expectations and with its year-to-date sales trend, down nine per cent.

At Target same store sales dropped by 6.2 per cent to $5.69 billion. Saks of Fifth Avenue, the high end fashion retailer, saw a more modest 4.4 per cent drop in same store June sales top $230 million.

Gap, which also owns Banana Republic and Old Navy chains, reported June sales of $1.29 billion, producing a fall of 10 per cent on a same store basis.

Even some discount retailers, which have generally fared better during the recession, reported declines. Costco saw a 6 per cent fall in like for like sales in June. Even allowing for the negative effects from fluctuating foreign exchange rates and gasoline prices, sales fell by 1 per cent. Bob Nelson, the company’s vice president of financial planning and investor relations, said a decline in sales of summer staples such as air conditioners, a result of the poor weather, had hit the company.

However, Aeropostale, a value clothing retail chain for teens, reported a 12 per cent rise in same store sales. The company, which has 885 stores, is expanding with the opening of ten stores selling its new range for seven to 12-year-olds. The Children’s Place, selling clothing for children and teenagers up to 14, saw an 18 per cent rise in same store sales, suggesting that while adults may be cutting back on spending for themselves, they might not be doing the same with their children.

Ken Perkins, president of Retail Metrics, a research firm based in Massachusetts, said that total US comparable-store sales probably dropped 4.6 per cent last month.

"The back-to-school selling season will take on added significance as it is the only noteworthy catalyst for consumer spending between now and the holiday shopping season," he said in a note.

The sales falls were steeper than some analysts had expected and reflects shaky consumer confidence. Employers in the US cut more jobs than forecast in June and the unemployment rate rose to 9.5 per cent, the highest in almost 26 years, limiting wages and threatening to erode the consumer spending.

Wal-Mart, the world’s largest retailer, has stopped reporting monthly sales as of May 1, citing the difficulty of predicting shoppers’ behaviour. In May is said that sales at US stores and its Sam’s Club membership warehouses may rise as much as 3 per cent in the 13 weeks to 31 July .

The economic crisis has swept away a number of US retailers such as the jewellery and housewares chain Fortunoff, department store Mervyn's, the home décor chain Lenox and the clothing company Eddie Bauer. It is also hitting landlords of shopping malls, where vacancy rates can run as high as 10 to 15 per cent.

Last year, the amount of space occupied by US retailers fell for the first time since 1980 and has yet to recover, according to research firm Reis.

Occupancy levels in some malls are now so low that some retail chains are invoking clauses in their leases that entitle them to seek rent cuts if key tenants or a certain number of stores leave the complex.

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