Retail sales increase in March for the fourth straight month

U.S. retailers benefited from an improving job market in March as consumers spent more despite dealing with the rising cost of filling up their gas tanks. 

Retail sales were up 0.4 percent last month, tallying nine months of increases following an upwardly revised 1.1. percent gain in February, the Commerce Department reported Wednesday. 

The increase dropped to 0.1 percent when gas station sales were excluded as sales were tugged downward by the largest decrease in auto sales in more than a year. 

Sales were up 0.6 percent when gas station and auto sales were removed. 

Gas station sales were up 2.6 percent as sharply rising gas prices contributed to the gain in retail sales. 

Gas prices have continued to rise as unrest in the Middle East and North Africa continues, driving the national average for regular gasoline up to $3.80 a gallon from $3.56 a month ago, according AAA.

An improving job market should lead to larger increases in consumer spending, which accounts for 70 percent of economic activity, but any big jumps are being hampered by higher fuel and commodity prices. 

The economy created 216,000 jobs in March, the most since May 2010, while the unemployment rate fell to 8.8 percent, the fourth straight month of drops and a two-year low, Labor Department reported. Economists have estimated the unemployment rate could hover around 9 percent for the remainder of 2011. 

Meanwhile, auto sales in March were off 1.7 percent, the largest drop since February 2010, but sales could pick back up if the job market continues improving, economists estimate. 

Furniture sales were up 3.6 percent, the biggest increase in seven years, along with sales at appliance and specialty clothing stores. Sales at general merchandise stores, which include big retailers such as Walmart, went up 0.4 percent.

Department store sales, such as those at Macy's, dropped 0.2 percent in March whereas major retailers has reported better than expected sales in March.