Stronger retail sales add to signs of recovery

LONDON Wed Apr 11, 2012 7:23am BST

Shoppers sit outside Primark on Oxford Street, in central London, March 27, 2012. REUTERS/Andrew Winning

Shoppers sit outside Primark on Oxford Street, in central London, March 27, 2012.

Credit: Reuters/Andrew Winning

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LONDON (Reuters) - Retail sales rose at the fastest pace so far this year in March and more jobs became available across different sectors, surveys showed on Wednesday, adding to signs that the economy is slowly recovering.

The British Retail Consortium said that like-for-like retail sales, a figure that strips out changes in floor space and is favoured by equity analysts, increased by an annual 1.3 percent in value terms.

That easily beat economists' forecasts for stagnant sales and marks an improvement on the 0.3 percent drop recorded in February.

Stephen Robertson, BRC Director General, said retail sales in March were lifted by unusually warm and sunny weather, which encouraged Britons to buy clothes and shoes for the new season, as well as goods for outdoor leisure activities.

But he warned that the data did not necessarily mark a turnaround in the sales trend.

"It will take more than a week of sunshine to transform retailers' fortunes," Robertson said.

Total retail sales, a measure used more by economists and closer to that found in official statistics, were up 3.6 percent, following a 2.3 percent rise the previous month.

Consumers, who account for nearly two-thirds of all spending in Britain, have tightened their belts sharply since the 2007-2009 crisis.

But there are signs of a shopping revival as morale edges off record lows , and a stabilising labour market should support Britons' confidence.

The Recruitment and Employment Confederation, which represents recruitment agencies, said its survey conducted together with consultancy KPMG showed the number of vacancies in Britain rose in March at the fastest pace since last July.

Permanent staff placements also increased for the third month in a row, albeit at a slightly slower pace than in February: The REC's monthly index ticked down to 52.4 from 53.2 in February. Readings above 50 indicate growth.

From this month, hiring should get a further boost from recent tax changes, a government-supported programme for young jobless and cuts in red tape for businesses, said Tom Hadley, Director of Policy and Professional Services at the REC.

However, the authors of both surveys cautioned against excessive optimism, noting that the economy remained fragile.

(Reporting by Olesya Dmitracova; editing by Hugh Lawson)(olesya.dmitracova@thomsonreuters.com; +44 20 7542 8051; Reuters Messaging: olesya.dmitracova.thomsonreuters.com@reuters.net)

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