Motor traders failed to share in an unexpected revival in retail sales last month.
While retailers who said their sales were better than those in May last year outnumbered those reporting a drop by nine per cent, in the motor trade there was an adverse balance of minus 22 per cent - the worst showing since last December.
But these findings in the CBI's distributive trades quarterly survey for the three months to May were
accompanied by evidence that motor traders have been more successful than mainstream retailers in passing higher prices on to their customers.
While a balance of 41 per cent of motor traders said they obtained higher prices in May - more than in any month since August - a balance of four per cent of retailers were forced to cut prices.
They have sought to offset the impact on their profit margins by cutting back staff.
Retail employment has been in a two-year decline, the CBI noted. Over the latest three months, 39 per cent said they employed fewer people than in the same months last year, while only ten per cent had taken on more staff.
The resulting negative balance of minus 29 per cent is an all-time record, though only slightly worse than the minus 26 per cent reported three months ago. A further, though more moderate fall is expected for the year to June.
One highlight of the survey was a sharp pick-up in sales of durable household goods - where a balance of 65 per cent reported an improvement.
This was not matched, though, by sales of furniture, carpets or DIY goods, which also tend to benefit from an active housing market.
This contrast led to suggestions yesterday that the boom in durable goods reflected buoyant demand for flat- screen and high definition TV sets ahead of the World Cup.
"Everyone has been looking for a pick-up in consumer demand, so it is encouraging to see sales increase for some sectors with underlying demand improving overall," said John Longworth, an executive director of Asda and chairman of the survey's panel.
"But growth in sales is still a world away from the rate we were seeing just a few years ago and retailers are still facing fierce price competition and tighter profit margins.
"This pressure to discount, coupled with the poor retail climate of the last year or so, has forced retailers to lay off more staff."
Nor was there any sign of a let-up in the relentless rise of energy, transport and other utility costs, Mr Longworth warned.
"Let us hope that retailers' cautious optimism becomes a reality with a successful World Cup stimulating demand."
A balance of 12 per cent of retailers told the survey they expect their sales this month to be higher than in June last year. Asked about their view of the business situation generally, a balance of nine per cent are looking for an improvement over the next three months - although an over-whelming majority of 81 per cent expect things to "remain stable".
This optimism was strikingly not shared by motor traders. Among them, there was an adverse balance of 13 per cent expecting the business situation to worsen.