Despite report, consumers find clothes expensive

ARLINGTON, Va. -- Laurel Durham is like a lot of consumers these days. Careful about spending too much during an economic slowdown, the second-year law student waits for stores to slash prices before shopping for clothes.

She's noticed the markdowns, special sales events and coupons that retailers use. But despite a major dip in clothing prices reported Wednesday by the government, she says prices are still too high.

"I do try and wait until they're marking things down and offering coupons," she said, fingering a clearance rack in search of clothes for the legal job she starts next week.

Only hours earlier, the government had reported that consumer prices rose 0.3 percent in April, held back in part by the biggest plunge in the price of apparel in 52 years.

Clothing prices dropped 1.3 percent after rising in each of the previous two months, making for the largest decline since a 1.9 percent dip in January 1949.

Economists offered several explanations.

Retailers, also coping with the economic slowdown, heavily discounted merchandise and held big pre-Easter holiday sales to rid themselves of stockpiled inventory.

Demand also has weakened for some items as consumers, keeping one eye on the economy and the other on their personal finances, are becoming more cautious about spending.

Desiree Owens, who said she buys clothes weekly, hasn't found them becoming cheaper. Nor did several other shoppers interviewed Wednesday at a complex near the Pentagon.

"I shop too much to say that they've really gone down," said Owens, a Defense Department employee checking out "Customer Appreciation Day" at Macy's during her lunch break. Any shopper using the retailer's charge card got an additional 15 percent off.

"Sometimes you just happen to come in and you might find something that's gone down," Owens added, "but it takes months" to see any meaningful decrease in clothing prices.

Shirley Dahlner, 53, an X-ray technician on vacation from Seattle, said she hadn't noticed any drastic change in her spending for clothes.

"The prices are ridiculous so I only shop the markdowns," she said.

Asked his opinion of clothing prices, Dave Libbett didn't hesitate. "Too high," bellowed the vacationing Detroit resident, shopping for dress shirts with his teen-age son.

Brian Roome, 33, of Alexandria, Va., a site developer for a petroleum company, bought clothes last month for a wedding and the two vacations he's taking this year. He had no major complaints.

"I'm perfectly happy paying the prices I am," he said, carrying a pair of swim trunks intended for his Jamaican getaway this weekend.

Economists say retailers have been offering big discounts to move merchandise.

Michael P. Niemira, vice president of Bank Tokyo-Mitsubishi Ltd., said the price drop wasn't as dramatic as the one-month number suggests, because of flukes in seasonal adjustments.

Still, he said the broader trend in clothing sales is a long-term decline as consumers delay spending they consider discretionary because of the slowing economy.