Feb. 12 (Bloomberg) -- Sales at U.S. retailers unexpectedly halted a record six-month slide in January, an advance that may not be sustained as job losses climb.

The 1 percent increase followed a 3 percent drop the prior month, the Commerce Department said today in Washington. Excluding cars, the gain was 0.9 percent. Last month’s rise reflected higher gasoline prices and more spending on items including clothing and food.

“There were enough post-holiday sales to lure people into the stores; the question is whether that is sustainable -- and the answer is, obviously not,” said Tom Porcelli, a senior economist at Castlestone Management Ltd. In New York. A “collapsing’ job market means spending will deteriorate further, he said.

Separate figures today showed the number of Americans collecting unemployment benefits reached a record 4.8 million two weeks ago, reinforcing the threat to spending. Economists anticipate household purchases will tumble further in the first half of the year, underscoring the case for the $789 billion stimulus package under debate in Congress.

Stock-index futures initially pared losses after the retail- sales report was released, then resumed their decline. Contracts on the Standard & Poor’s 500 Stock Index fell 1.6 percent to 818 at 9:19 a.m. in New York. Treasuries were little changed, with yields on benchmark 10-year notes at 2.76 percent.

Economists’ Forecasts

Retail sales were projected to fall 0.8 percent after an initially reported 2.7 percent drop the prior month, according to the median estimate of 72 economists in a Bloomberg News survey. Forecasts ranged from a decline of 2.2 percent to a 0.7 percent gain.

Sales excluding automobiles were forecast to decrease 0.4 percent from the prior month, according to the survey median.

The figures aren’t adjusted for inflation, so price increases can influence the data. The average cost of a gallon of regular gasoline last month rose by 10 cents to $1.78 a gallon, according to AAA.

Receipts at filling stations increased 2.6 percent in January, the first gain in six months, following a 16 percent decline in December.

Today’s report showed sales at automobile dealerships and parts stores rose 1.6 percent, the first gain since August, after decreasing 2 percent.

Outlook for Autos

Still, demand for automobiles has softened as banks tighten lending standards and consumers hunker down. Sales plunged 55 percent at Chrysler LLC and sank 49 percent at General Motors Corp. last month as car loans became scarce after credit seized up late last year.

If consumers “can’t get credit, you can’t sell vehicles,” Mark LaNeve, GM’s sales chief, said in an interview Feb. 3. “This is what is choking us to death.”

Excluding autos, gasoline and building materials, the retail group the government uses to calculate gross domestic product figures for consumer spending, sales rose 1.2 percent in January, following a 1.7 percent decrease in December. The government uses data from other sources to calculate the contribution from the three categories excluded.

Sales also rose for electronics, appliances, clothing and food and beverages. Sales declined at building materials stores, furniture outlets and department stores.

Purchases at non-store retailers, which include online and catalog sales, rose 2.7 percent.

Annual Drop

Retailers are nonetheless bracing for the first annual drop in sales in at least 14 years, according to the National Retail Federation. January same-store sales dropped 1.6 percent from a year ago, the International Council of Shopping Centers reported last week.

Consumer spending is set to contract again this quarter after falling in the second half of 2008, economists predict. Purchases haven’t declined for three consecutive three-month periods since records began in 1947.

The world’s largest economy may contract at a 5.5 percent annual pace this quarter after shrinking at a 3.8 percent rate in the last three months of 2008, according to a forecast by economists at Morgan Stanley in New York. Last quarter’s drop was the biggest since 1982.

The unemployment rate jumped to 7.6 percent in January, the highest level since 1992, the Labor Department said last week. Payrolls plunged by 598,000, bringing the total number of jobs lost over the last 13 months to 3.6 million.

Retailers are slashing staff as they forecast declining sales. Macy’s Inc., the second-largest U.S. department-store company, is eliminating 7,000 jobs after discounts of 60 percent failed to stem revenue declines during the worst holiday season in four decades.

“Reducing our workforce is an unfortunate outcome of the current economic environment,” Chief Executive Officer Terry Lundgren said in a statement last week.

To contact the reporter on this story: Bob Willis in Washington at bwillis@bloomberg.net

Last Updated: February 12, 2009 09:34 EST