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If popular culture is to be believed, English zombies head to the pub, American ones to the mall. Were the undead persuaded to bring cash, retailers might welcome a mild epidemic of flesh-eating automatons. It would certainly be preferable to the reality now in prospect.

US retailers’ sales figures for January showed that weak holiday shopping trends continued into the new year. Department stores saw comparable sales decline by 12 per cent, prompting Standard & Poor’s to issue a warning of potential rating downgrades at six of the upscale retail chains. Wal-Mart, the discount superstore that reports fourth-quarter earnings on Tuesday, seems to be the only retailer capable of growing consistently in this environment.

Nor is there an end in sight. Overall consumer spending is likely to shrink this year for the first time since 1980. Clothing retailers in particular are nervously eyeing silent shop floors. Customers have got used to discounts, and those not worried for their jobs prefer to save while home and equity valuations continue to drop.

There is also a structural problem to contend with. Decades of free spending has left the US with too many shops. Even without the impact of rising floor space, Credit Suisse calculates that between 1990 and 2008 the number of department and speciality clothing stores grew by 168 per cent to 36,400. Over the same period, nominal spending on clothes grew by just 89 per cent. The total stock of US retail floor space grew by 5 per cent in the past two years alone.

So productivity – measured in sales per square foot – has some way to fall yet: 10 per cent just to hit the trough levels of 2002, estimates Barclays Capital. To recover profitability, the sector will have to shrink. Too many stores are already the commercial equivalent of the living dead.

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