The National Retail Federation’s annual holiday forecast predicts that holiday retail sales are anticipated to increase between 3% and 4% this year, reaching a record-breaking total of over $957 billion. The NRF suggests that if sales reach the upper end of their forecast, Americans could potentially spend up to $30 billion more than they did last year during the holiday season. However, this year’s spending is projected to be more moderate compared to the surges seen during the peak years of the pandemic.
The NRF acknowledges that while the percentage increase in spending is expected to be lower than in 2020, 2021, and 2022, consumers are still expected to engage in a healthy amount of holiday shopping, which is good news for retailers. NRF President and CEO Matthew Shay highlighted the resilience and strength observed in the consumer sector, despite economic uncertainty and household challenges. According to Shay, the anticipated spending growth is in line with the average 3.5% annual holiday growth experienced in the years prior to the pandemic.
According to NRF Chief Economist Jack Kleinhenz, robust employment opportunities and wage increases are the primary factors motivating consumers to continue spending, even in light of concerns about the broader economic situation.
The NRF’s annual forecast is closely monitored as a key indicator of the holiday season’s outlook for the nation’s retailers, with the group having issued this forecast for the past two decades.
Throughout the year, economists had been anticipating a slowdown in spending, but consumers have proven to be more resilient than many analysts had predicted.
The retail sales figures for September came as a pleasant surprise, with a month-over-month increase of 0.7%, exceeding expectations by more than twice the anticipated gain.
Most of the initial holiday spending projections have leaned towards a cautiously optimistic to upbeat outlook.
Forbes.com, Joan Verdon.
