Sears, Roebuck & Co.'s retailing profits are increasing and Sears' sales, which have been slipping for nearly a year, are expected to begin growing again next month, company executives said today.

But Sears chairman Edward R. Telling said he expected only a modest increase in Christmas sales this year because the nation's economy is slowing down.

Telling said he is uncertain about what affect gasoline shortages will have on the retail business. "I just can't read this gas thing. That has to be a concern," Telling said at a press conference after Sears' annual shareholder meeting.

The meeting was held at Sears' West Coast headquarters here in Southern California where the gas lines have been the longest.

About a thousand shareholders - many of them retired Sears' employes whose pension plan controls the largest single block of the company's stock, some 20 percent - attended the meeting. They questioned telling for more than an hour about Sears' slumping sales and earnings, the low price of the company's stock and Sears' fight with the Equal Employment Opportunity Commission over affirmative action programs.

At the meeting, Telling announced that Sears' first-quarter profits were slightly below its record earnings a year earlier.

For the three months ended April 30, Sears earned$150 million (47 cents a share), or 3.4 percent less than last year's$155 million (48 cents). Sales were $3.63 billion of 1978.

Most of the decline was due to Sears' Allstate Insurance companies and higher interest rates which were offset partially by increased retailing profits.

The Sears' retail stores earned about $40.4 million, nearly 25 percent more than the $32.2 million a year earlier.

The Allstate companies, which contributed$108 million (34 cents) to Sears' earnings last year, earned only $97.2 million (30 cents) this year. Allstate Chairman Archie R. Boe blamed the declining insurance earnings on severe winter weather in the Midwest and on the soaring costs of auto repairs.

Higher interest rates cut about 4 cents a share from Sears' profits, Telling said, as the company's interest expenses jumped from$105 million to$133 million. But Telling and other Sears executives stressed the improvement in the company's retail performance, which had been blamed for depressing the price of Sears stock to less than$20 a share.

"We are seeing improvement in sales," Telling said. He acknowledged that April sales were not as good as the company had expected but said, "the month of May will reflect a substantial improvement."

Jack F. Kincannon, senior vice president, finance, predicted, "We will have a decrease in May, but it will be a modest decline, and sales shouldbegin to grow again in June."

Last summer, in an effort to improve profits which Sears executives said had been hurt by too many sales-stimulating bargains, Sears cut back on promotional price cuts and said it was trying deliberately to reduce its sales and increase its profitability.

Recently, however, the company appears to have stepped up its promotions slightly because, as telling acknowledged today, the sales declines have been greater than anticipated. The Sears chairman told shareholders he expects the general merchandise retail business to show only a 4 percent to 6 percent increase in Christmas sales this year because of the economy.

Telling said that the nation's economy "may have several more good months of growth left in it" but he said the economy has been growing too fast with "too much inflation and very costly interest rates.

"To reduce these unfortunate side effects, a period of moderation is needed, and it now appears that a slowdown probably will develop in the second half of this year.

"After a breathing spell of two or three quarters, we believe that economic growth during 1980 will speed up again, but with less inflation," Telling said.

Telling's prediction of a 4 percent to 6 percent increase in Christmas business contrasted with a 6 percent to 8 percent gain forecast recently by J. C. Penney Chairman Donald Siebert

With virtually all California gas stations closed on Sunday, Telling said he feared the company's Sunday sales might suffer but so far they have not. "Mondays and Tuesdays are hurt." Telling said at the press conference, but "Sundays have become very strong."

Henry D. Sunderland, executive vice president is charge of Sears' far western territory, said California sales are running "3 to 4 percent behind the trend" that was set before the gas shortage began. But he added, the impact on sales seems to be decreasing.

"We seem to be coming back strong," he said, noting that "our sales weren't hurt too badly in the 1973-1974 gas crisis.

Telling said the company has begun increasing its inventories in anticipation of stronger sales later this year.

Sears' executives offered no clues as to the company's next move in its ongoing dispute with the EEOC.

"We're considering it," Telling said when asked if Sears would seek to reinstate its lawsuit against the EEOC which was dismissed last week in Washington by U.S. District Court Judge June Green.

In the lawsuit, Sears charged that it couldn't comply with EEOC regulations because government policies had created a work force dominated by white males, and because federal affirmative action regulations were contradictory and inconsistent.

Sears' decision to file the lawsuit was criticized by a shareholder representing United Methodist Women from California and several other religious groups that own Sears stock. Telling again defended the company's record on hiring women and blacks.

He said he did not know when the EEOC would file a formal complaint against Sears. The agency has prepared a preliminary order charging Sears with widespread bias against women and minority-group members.

During the stockholders' meeting, several persons identifying themselves as retired Sears' employes criticized changes in Sears' managementt since Telling became chairman a year ago. They criticized a trend toward centralized control over the once largely autonomous Sears stores and complained that, as retired buyer Robert Dickson put it, "Sears is being managed by auditors, operating experts and service technicians" rather than old-fashioned merchants.

Another former Sears employe complained that the company has abandoned "the 3Ms" of former chairman Arthur M. Wood-men, merchandising and methods. "Today the employe morale factor is at an all-time low," said retired Sears employe Harold Pierce.

Stockholders complained that their local Sears stores are running out of merchandise more often these days, leading Telling to acknowledge that the company's computerized Retail Inventory Management system is "frustrating" to executives because it is not working as well as it should.

Stockholders also criticized an incentive compensation plan for Sears executives that was submitted to the shareholders for their approval. One shareholder suggested that top management officials ought to be penalized for reducing the company's profits instead of receiving bonuses.

About 20 million of the 244 million shares represented at the meeting were voted against the incentive plan. Telling said later he did not consider that to be unusual opposition. CAPTION: Picture, Sears Chairman Edward R. Telling: says gasoline shortage's effect is uncertain. AP