• by Sarah Mahoney , October 3, 2017

Both the National Retail Federation and PwC are predicting happy holidays ahead, citing the steadier economy and sturdy levels of confidence in American shoppers.

The NRF forecasts that holiday sales will grow somewhere between 3.6% and 4%, or from $678.75 billion and $682 billion. (The Washington D.C.-based trade organization says it is issuing its forecast as a range this year because the impact of the year’s hurricanes on retail spending is still difficult to establish.) Last year’s spending totaled $655.8 billion, a gain of 3.6% from the prior year. If 2017 hits those marks, it will mean an annual growth rate of 3.5% for the last five years. 

The NRF points out that Christmas falls on a Monday this year, adding a full weekend to the shopping calendar compared to last year, and that there are 32 days between Thanksgiving and Christmas this year, one more than in 2016.

“Consumers continue to do the heavy lifting in supporting our economy, and all the fundamentals are aligned for them to continue doing so during the holidays,” says NRF chief economist Jack Kleinhenz in its announcement. “The combination of job creation, improved wages, tame inflation and an increase in net worth all provide the capacity and the confidence to spend.”

Meanwhile, professional services giant PwC is predicting a 6% gain in holiday spending, with 83% of the consumers it surveyed saying they plan to spend as much or more than they did last year, an average of $1,189 per person. (That includes spending $360 on themselves, $680 on family and $95 on friends.)

But its survey, based on responses from some 2,400 adults, finds those gains to be driven primarily by higher-earning consumers. Families earning less than $60,000 plan to cut spending in every category but travel, trimming their gift budget to $517, an 8% drop, and their entertainment budget to $140, down 4%. They expect travel expense to increase 25% to $253.

In contrast, families with household incomes of $60,000 or more are looking for across the board increases, with gift budgets rising 3% to $822, travel rising 8% to $432, and entertainment rising 10% to $253.

With the advent of big sale events, including Amazon’s Prime Day and Cyber Monday, PwC is detecting a big drop in interest in Black Friday, with 35% of its survey saying they plan to shop then, compared to 51% in 2016 and 59% in 2015.

Last month, Deloitte forecast a gain of between 4 and 4.5%, while the International Council of Shopping Centers expects an increase of 3.8%.