June retail sales excluding auto purchases were down compared to sales from the previous month, although the monthly figures from the Department of Commerce reported modest growth over June 2009, the Retail Industry Leaders Association (RILA) said.

Overall retail sales declined 0.6% in June, but went up 5% over sales in June 2009. Retail sales excluding auto and auto part sales slipped 0.1% in June, but showed gains of 4.4% over the previous year. Department store sales grew by 1.1%, while home improvement, home furnishing and sporting goods retailers all saw declines of 1% or more.

"Although there is no question that the economy and the retail industry are in a considerably better place today than a year ago, retailers continue to face strong economic headwinds, limiting the industry's short-term growth," said RILA President Sandy Kennedy. "Persistent high unemployment continues to drag down retail sales further dampening hopes of meaningful near-term growth.

However, back-to-school spending is expected to offer a retail boost this year, according to the National Retail Federation (NRF).

The group's 2010 Consumer Intentions and Actions Back to School Survey predicts that the average American family will spend just over $606 on clothes, shoes, supplies and electronics, compared to just under $549 last year, with total spending on children aged K-12 reaching $21 billion.

But the NRF study found that the economy still is making an impact, with more families planning to buy store brand or generic products (44.3% compared to 41.7% last year). Seven out of 10 survey respondents said that they intend to shop at a discount store and more will be shopping online (30.8% compared to 22.2%).

"We are encouraged by the fact that parents are eager to start their back-to-school shopping this year, but the industry still remains cautiously optimistic about recovery," said NRF President and CEO Matt Shay.

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