Here’s How Retail Sales Advanced the Most in 8 Months

U.S. Retail sales rose more than forecast in September in their biggest monthly advance since February. The 1.1% advance last month followed a 0.3% gain in August that was higher than previously estimated, according to a Commerce Department report issued today in Washington.

“It’s a strong performance,” said Guy LeBas, chief fixed- income strategist at Janney Montgomery Scott LLC in Philadelphia, who projected a 1% increase. “Retailers are in good position to profit from the holiday season.” Macy’s (NYSE:M) and Kohl’s (NYSE:KSS) are among the many retailers planning to boost holiday hiring this year.

Ten of the 13 major categories measured by the Commerce Department showed increases last month, led by auto dealers and clothing retailers. Auto purchases climbed 3.6%, the most since March 2010. Cars and light trucks sold at a 13.1 million seasonally adjusted annual rate, the highest since April’s 13.2 million, after which sales declined as Japan’s earthquake and tsunami began to cripple the global supply chain of parts and cars.

When excluding autos, purchases increased 0.6% last month. When excluding autos, gasoline, and building materials, sales still rose 0.6%, the most since March, after a 0.4% gain in August.

Excluding autos, gasoline and building materials, which are the figures used to calculate gross domestic product, sales also rose 0.6 percent, the most since March, after a 0.4 percent August increase.

Still, the high unemployment rate, the real-estate slump, and volatile markets will limit retail sales growth to roughly 2.8% during the holiday season this year, compared to a 5.2% gain last year, and a 10-year average of 2.6%. But stores are expected to hire 480,000 to 500,000 seasonal workers, in line with the 495,000 hired last year.

Macy’s (NYSE:M) plans to increase hiring of mostly part-time workers by 4% for the holiday season, while Kohl’s (NYSE:KSS) said last week that it may hire more than 40,000 holiday workers, a 5% increase over 2010.