Santa Claus leaves retailers without Christmas cheer

Even the traditional Christmas splurge failed to emerge to save Spanish retailers from a dire year in 2012 as sales fell by the most since 2009 when the country was locked in a deep recession.

According to figures released Tuesday by the National Statistics Institute (INE), retail sales declined 4.2 percent in 2012 when the country slipped back into recession again. The fall in 2009 was 7 percent.

At constant prices and after correcting for differences in the number of working days, sales in December alone declined 10.7 percent from a year earlier after falling only 7.8 percent the previous month. The December drop was the biggest for the year and brought to 30 the number of consecutive months in which sales have declined.

Employment in December dropped 1.4 percent from a year earlier, the 53rd month in a row in which it has declined. For the full year, employment shrank by 1.2 percent.

The Spanish Confederation of Trade (CEC) estimated last December was the worst for the sector in 20 years. Retailers take in between 20 and 25 percent of their annual turnover in the month.

“The figures vary from place to place, but they all show a spectacular fall in sales associated with the pronounced stagnation of national consumption,” the association said in a statement. “Urgent and effective measures that generate confidence, stimulate consumption and ease access to financing are needed to support the sector,” it added.

Apart from the impact a jobless rate of 26 percent, the sector has been hit by the government’s austerity drive under which the standard and reduced value-added tax rates were hiked, while civil servants deprived of their traditional Christmas “bonus” payment.

Sales fell in all of the country’s 17 regions in the last month of the year, with the biggest drops recorded by Castilla y León where they declined 12.3 percent and Cantabria with a fall of 12.1 percent.

Spending on all items, including food, declined in December. Food sales were down an annual 5.1 percent, personal equipment down 8.8 percent and household equipment 13.6 percent.