WASHINGTON — This year’s holiday spending has the potential to shatter previous records, the National Retail Federation (NRF) said, forecasting that sales during November and December will grow between 8.5% and 10.5% over 2020 to total between $843.4 billion and $859 billion.

The numbers (which exclude automobile dealers, gasoline stations and restaurants) suggest that sales this holiday season will top the previous high recorded last year, when sales grew by 8.2% to $777.3 billion. The average sales increase over the past five years was 4.4%.

“There is considerable momentum heading into the holiday shopping season,” NRF president and chief executive officer Matthew Shay said. “Consumers are in a very favorable position going into the last few months of the year as income is rising and household balance sheets have never been stronger. Retailers are making significant investments in their supply chains and spending heavily to ensure they have products on their shelves to meet this time of exceptional consumer demand.”

NRF expects that online and other nonstore sales, which are included in the total, will increase between 11% and 15% to between $218.3 billion and $226.2 billion. That number is up from $196.7 billion in 2020.

Last year saw extraordinary growth in digital channels as consumers turned to online shopping to meet their holiday needs during the pandemic. While e-commerce will remain important, households are also expected to shift back to more traditional holiday shopping in stores.

“The outlook for the holiday season looks very bright,” NRF chief economist Jack Kleinhenz said. “The unusual and beneficial position we find ourselves in is that households have increased spending vigorously throughout most of 2021 and remain with plenty of holiday purchasing power.”

“Pandemic-related supply chain disruptions have caused shortages of merchandise and most of this year’s inflationary pressure,” Kleinhenz said. “With the prospect of consumers seeking to shop early, inventories may be pulled down sooner, and shortages may develop in the later weeks of the shopping season. However, if retailers can keep merchandise on the shelves and merchandise arrives before Christmas, it could be a stellar holiday sales season.”

While it appears new COVID-19 infections and hospitalizations are down, a variant surge could potentially sidetrack the current trajectory of spending. Kleinhenz commented that strong household fundamentals provide optimism amid the uncertainty. Income is growing from wage compensation, and household wealth has reached another record high. These factors together support strong spending this holiday season.