The National Retail Federation is forecasting a healthy gain of 3.7% in holiday sales, which are expected to reach $630.5 billion. And it predicts between 6 and 8% rise in online sales, to as much as $105 billion.
The overall increase is well above the 10-year average of 2.5%. And while it’s less than the 4.1% increase notched last year, some of that difference is due not to slower consumer spending, but rather to flat prices in many sectors of the economy. Besides, NRF execs said in a conference call, Americans are just feeling pretty darn good about the current economy.
“Between lower gas prices and a solid housing market, consumers are spending when they are presented with the right product and the right price,” says NRF president and CEO Matthew Shay. “While that requires retailers to be very competitive, it all creates a scenario for a very positive holiday season.”
“We are having a solid economy and the consumer is behind it,” says NRF Chief Economist Jack Kleinhenz, “and we’ll see individuals taking advantage of the fact that prices haven’t moved against them.” He expects shoppers to shift from big-ticket items, including cars, as the holidays get closer. And the consumers’ propensity to spend more on themselves these days, particularly in terms of service, travel and restaurants, is also a good sign.
November and retail sales this year are expected to account for 19% of the retail industry’s annual $3.2 trillion in sales, and this year, the addition of some 750,000 season jobs.