Holiday shoppers this year are facing rising prices, another interest rate hike that will make using their credit cards more costly, and the threat posed by new COVID variants, the flu and a surge in respiratory syncytial virus (RSV) infections.
Despite all this, most forecasts for retail sales this holiday shopping season are pretty optimistic.
The National Retail Federation has predicted that holiday sales will grow between 6% and 8% this year, which is lower than last year’s 13.5% but higher than the 4.9% average over the last 10 years.
And while consumers’ willingness to spend has been “clearly impacted by inflation,” NRF’s report argued their ability to spend has been supported by job growth, rising wages and the fact that they can tap into savings accumulated during the pandemic.
The Mastercard SpendingPulse annual holiday forecast for 2022 was also upbeat, forecasting a 7.1% increase in retail sales this holiday season, excluding gas and automobiles.
Deloitte’s 37th annual Holiday Retail Survey finds consumers concerned about inflation and expecting to keep their spending flat year over year, for an average of $1,455 per household, while purchasing fewer gifts for family and friends. The survey also found 32% of consumers say they plan to buy resale items this year as a way to cut costs. Despite most consumers planning to keep their spending in check, Deloitte has forecast that retail sales this holiday season will increase 4% to 6%.
NPD Group chief retail industry advisor Marshal Cohen foresees a more “grinchy” consumer this year, with most planning to spend as much as or more than last year, but 39% expecting to spend less.
As a result, NPD Group is predicting flat sales versus last year for November and December, and up to a 2.5% gain for mid-October through early January.