NEW YORK—Retail sales fell in May, dragged down by a decline in auto sales and a shift by Americans to spend more on vacations and other services instead of goods. Total sales dropped a seasonally adjusted 1.3 percent in May from the month before, the U.S. Commerce Department said Tuesday. Wall Street analysts expected a smaller decline of 0.5 percent. Economists predicted retail sales to drop in May because of the lack of cars available for sale due to a worldwide shortage of chips, which are needed to power in-car screens and other features. Sales at auto dealerships fell 3.7 percent last month, the government said. Another reason for the decrease: As more Americans are vaccinated and want to head out more, they are spending more of their money on haircuts, trips, and other services that are not included in Tuesday’s report. Last month, sales fell at furniture, electronics, and …