Retail Sales Skid in March, Raising Doubt on Recovery : Economy: The nationwide drop of 1% prompts a call from the Clinton Administration for passage of its stalled stimulus package.

Nationwide retail sales dropped 1% in March--the sharpest decline in more than two years--prompting concerns that the economic stall could continue into spring.

The sales report, issued Tuesday by the U.S. Commerce Department, said many consumers were unable to make purchases during a mid-March storm that immobilized much of the eastern half of the nation. The Commerce Department report included no figures for individual states, including California.

The Clinton Administration used the report to argue that its economic stimulus proposals--blocked by filibustering Senate Republicans--are badly needed. Commerce Secretary Ronald H. Brown said the March sales decline “provides compelling evidence that recovery is at risk unless decisive action is taken when Congress returns from its recess next week.”

The decline was the largest since January, 1991, and put overall sales of $166.9 billion at their lowest level since last September. Debt and joblessness, in addition to the bad weather, accounted for much of that sales dip, said Kurt Barnard, a New York-based retail economist. Of the 380,000 new jobs created nationwide in February, only 32,000 were full-time positions and the balance were part-time, Barnard said.

“Part-time jobs will not create a spending spree,” Barnard said.

In addition, many Americans are not spending discretionary income but are using it to reduce personal debt, which expanded rapidly late last year, Barnard said. Nationally, consumers’ revolving debt--money owed to credit card companies and retailers--rose $1.5 billion in December, 1992, and now totals $252 billion, Barnard said.

Even food store sales, which are usually immune from major fluctuations, were hit hard in March, dropping 1.6%. Analysts said this almost certainly reflected weather conditions.

Money markets responded to the retail sales report. The dollar finished mixed against major currencies, tumbling to a 2 1/2-month low against the German mark after the report raised concern about the U.S. economic recovery.

The March figures extended the disappointments of the first quarter. Adjusted for inflation, sales rose only about 3% nationwide during the first quarter over the same three-month period during the recession a year ago.

Barnard and other economists predict that nationwide sales will rise negligibly--2% to 3%--in the next three months. A more robust increase in retail spending would be needed to help the economy grow, economists say.

There are no official figures available yet on California’s first-quarter retail sales. Some economists say sales were flat during the first three months, while others say sales actually decreased 2% in the period.

Many of the state’s retailers are responding to California’s litany of economic problems--military base closings, real estate woes and the troubled computer and aerospace industries--by maintaining smaller inventories, said Jack Kyser, economist at the Economic Development Corp. of Los Angeles County.

Retail Sales: Seasonally adjusted, billions of dollars

March, ‘93: $166.9

Feb., ‘93: $168.7

March, ‘92: $159.6

Source: Commerce Department