Holiday sales rose 3 percent, retail group says

NEW YORK (AP) -- Holiday sales rose 3 percent, a major retail trade organization said Tuesday well below its forecast for a 4.1 percent gain.

The figures offer the latest evidence that shoppers held back on spending amid economic uncertainty in a season that accounts for as much as 40 percent of stores' annual revenue.

The National Retail Federation, the nation's largest retail industry group, said Tuesday that retail sales for November and December combined totaled $579.8 billion. December sales rose 2.1 percent while November sales rose 3.9 percent, according the federation's analysis of government data. The figures are being compared with the year-ago periods.

Holiday sales rose 5.6 percent in 2011 and 5.5 percent in 2010. The 2012 holiday figures marked the slowest sales growth since 2009, when sales rose 0.3 percent.

For the first time, the federation is counting online sales and sales from the auto parts and accessories business. But even non-store sales, which includes online sales, were below expectations for the two-month period. They rose 11 percent, below the 12 percent that the industry projected.

"For over six months, we've been saying that the fiscal cliff and economic uncertainty could impact holiday sales," Matthew Shay, president of the National Retail Federation, said in a statement. "As the numbers shows, these issues had a visible impact on consumer spending this holiday season."

The numbers were released as the thousands of retail executives are gathering in New York this week for the annual federation's convention to share strategies for 2013 and offer insights into shoppers' mindset. Retailers are being forced to reinvent themselves as shoppers increasingly shift to the Web and use their mobile devices to shop or do research. According to the federation, non-store sales accounted for 16 percent of holiday sales, up from 15 percent a year ago.

The announcement followed the Commerce Department's release on Tuesday of overall sales figures for December. Retail sales rose 0.5 percent in December from November, according to the government data. That's slightly better than November's 0.4 percent increase and the best showing since September.

Shoppers were grappling with a number of issues. Superstorm Sandy, which pummeled the Northeast in late October, hurt sales in the beginning of November, as businesses and households were disrupted. Then the national election caused shoppers to delay. Consumers were also worried about tense negotiations to resolve the fiscal cliff. Congress and the White House ultimately reached a deal on Jan. 1 that prevented income taxes from rising for most households

So after a solid spending spree over the Thanksgiving weekend, sales limped along until the final days before Christmas, when stores were forced to discount more than they had planned to woo back shoppers.