Nervous about jobs and an unraveling economy, shoppers spent at best only slightly more this August than last, according to data released Wednesday by MasterCard's SpendingPulse.
The figures confirm a flurry of anecdotal evidence that retailers will be disappointed by this year's back-to-school season a time they see as second only to the winter holidays.
"We are still not seeing a rebound," said Michael McNamara, vice president of research and analysis for SpendingPulse, which includes transactions in all forms including cash.
The good news is for consumers: Those who hoped for prices to fall and held off spending may be in luck if stores deepen discounts further to get rid of fall merchandise.
SpendingPulse's figures show shoppers spent more on children's clothing and consumer electronics than last August. But they pulled back on most other merchandise, including women's and men's fashions and luxury goods. In fact, spending in August on many types of nonessentials remained about where it was five years ago.
Women's clothing has been hit particularly hard, with revenue shrinking to about $300 million about the same as 2004 and 2005, according to McNamara.
Online sales, up for a 13th month in a row, remained a rare bright spot. They rose 7.2 percent from a year ago, when they were up 1.5 percent.
All the figures compare spending from Aug. 1 through last Saturday with the first four weeks of August 2009.
Unrelenting hot weather in most of the country depressed shoppers' appetite for fall clothing. But shoppers also were reluctant to buy jeans and other items they could have worn right away.
Stifel Nicolaus analyst Richard Jaffe noted that heavy discounting on jeans that started in July hasn't grabbed much attention.
"I'm fairly convinced that we are seeing changes in consumer behavior that will be sustained for a long time," Jaffe said.
Shoppers need to be "very convinced and excited" before paying for anything, Jaffe said: "It's becoming even more pronounced now."
It looks like many kids are going back to school with their old computers, for instance. Intel Corp. lowered its forecast for the third quarter last week, saying demand for consumer PCs has been weaker than expected. Hewlett-Packard Co. and Dell Inc. also raised red flags about what is normally a strong season for sales.
The figures from SpendingPulse may mask even greater weakness in consumer spending because they are being compared with a period when revenue was still in the dumps. In September, stores will face more difficult comparisons because consumer spending had started rising by September 2009.
August's data continue a trend that began in April, after sales rose at the holidays and through March.
But shoppers are increasingly jittery with a slew of reports showing the economy's recovery halting.
The private Conference Board's monthly survey, released Tuesday, showed shoppers feeling slightly more optimistic in August than July but not more than a year ago. And there's no reason in sight for them to feel better soon.
Home sales are plunging, and consumers are saving more and spending less as the unemployment rate remains stuck at almost 10 percent.
A fuller picture of how retailers fared in August is due Thursday, when chains like Macy's Inc. and Target Corp. report their revenue at stores open at least a year. The figures are considered a key indicator because they exclude the effects of expansion and stores closing.
Mike Niemira, chief economist at the International Council of Shopping Centers, expects a 3 percent rise in the indicator, which fell 2 percent a year ago.
But Millard Drexler, chairman and CEO of J. Crew, said in a conference call with analysts last week that consumers are "deferring, they're waiting, they're comparison shopping, and people are a little nervous."
There's even evidence some stores have been trying to cancel orders for late fall or send what they've ordered straight to discounters like TJX Cos., Jaffe said. He noted that stores are hoping to make up for August's shortfall in September, but the writing is already on the wall.
"Demand has been weak. They'll finish below plan," he said.