Holiday sales to grow between 3.8 and 4.2 percent this year

The National Retail Federation expects sales in November and December to grow between 3.8 and 4.2 percent as shoppers go on a buying spree between Thanksgiving and New Year.

Across the country, consumers are expected to spend $1,048 on average – 4 percent more than last year, Katherine Cullen, NRF’s head of consumer research, revealed in a podcast.

The NRF, earlier, explained in its detailed forecast that the 3.8 to 4.2% jump in shopping will be over 2018 to a total of between $727.9 billion and $730.7 billion.

In previous years, the numbers, which exclude automobile dealers, gasoline stations and restaurants, average holiday sales went up by 3.7 percent.

“The U.S. economy is continuing to grow and consumer spending is still the primary engine behind that growth,” NRF President and CEO Matthew Shay said in October. 

“Nonetheless, there has clearly been a slowdown brought on by considerable uncertainty around issues including trade, interest rates, global risk factors and political rhetoric.  Consumers are in good financial shape and retailers expect a strong holiday season. However, confidence could be eroded by continued deterioration of these and other variables.”

Shoppers at a Target store Image: Gridprop at English Wikipedia [Public domain], via Wikimedia Commons

“There are many moving parts and lots of distractions that make predictions difficult. There is significant economic unease, but current economic data and the recent momentum of the economy show that we can expect a much stronger holiday season than last year. Job growth and higher wages mean there’s more money in families’ pockets, so we see both the willingness and ability to spend this holiday season.”

NRF expects online and other non-store sales, which are included in the total, to increase between 11 percent and 14 percent to between $162.6 billion and $166.9 billion, up from $146.5 billion last year.

The seasonal hiring will also see a rise.

“Even with trade uncertainty and the increasingly tight labor market, retailers have been hiring extra staff to meet expected demand during the holiday season. NRF expects retailers to hire between 530,000 and 590,000 temporary workers, which compares with 554,000 in 2018.”

The NRF says its holiday forecast is based on an economic model that takes into consideration a variety of indicators including employment, wages, consumer confidence, disposable income, consumer credit and previous retail sales.

The federation also says that its forecast numbers may differ from other organizations’ forecasts that define the holiday season as a longer time period or include retail sectors not counted by NRF such as restaurants.