Retailers suffered more pain as sales continued to drop for the 14th consecutive month, according the latest figures released by Government.

The Department of Statistics' Retail Sales Index revealed that retail sales volume fell 5.5 percent (or 3.8 percent in value) to $89.4 million, while residents returning to the Island from business and holiday trips declared overseas purchases of goods valued at $6.4 million during May 2010 - 12.3 percent lower than in May 2009.

The biggest drop per sector was in building materials, which was down 21.4 percent in May 2010.

Kristi Grayston, chairman of the retail division of the Bermuda Chamber of Commerce, said the decline did not come as that much of a surprise, but she had expected sectors such as the tourist-related retailers to have performed better during the season.

However she believes that the figures for June through to August will give a better indication of how the retail industry is faring in the economic downturn.

Ms Grayston said there were a number of positive signs, including a marginal 0.6 percent increase in apparel store sales during the month of May, as reasons to be optimistic.

"I am quietly optimistic for the fourth quarter," she said.

"May was the season change and although cars, construction and appliances are probably going to be a drag on retail sales for the months going forward, June is the real tell-tale time."

Meanwhile Ms Grayston, who calculated that overall sales have actually been declining for the past 22 months, put the 11.3 percent drop in furniture and appliance sales down to the closure of HWP Group's HomeZone at the end of April. Overall the all other stores types fell 4.7 percent during May 2010, with pharmaceutical retailers recording the only increase within the sector of 1.6 percent.

The fact that resident purchases overseas also declined significantly, she said, was indicative that people had less money to spend, there was more unemployment and companies were cutting their staff to cover costs.

Retail sales of motor vehicles fell by 13.2 percent during the year, in part attributed to a four percent drop in the price of motor vehicles and a general decrease in sales volume, but the largest decline was in the building materials sector as the current recession continued to impact retailers and less building activity caused sales to plummet, as they have consistently since August 2009.

On the flipside, gross receipts for food stores remained steady with a slight rise of 0.4 percent for May 2010 versus the same period last year, while liquor sales dropped one percent.

Service station sales rose by 5.1 percent compared to May 2009 levels, mainly due to a 7.4 percent increase in the price of fuel.