NRF: Holiday spending expected to bring in $730B
Retailers projected to hire up to 590K temporary workers.
The National Retail Federation expects total holiday spending to reach roughly $730 billion, up about 4 percent from last year.
NRF President and CEO Matthew Shay said the U.S. economy continues to grow, but uncertainty around trade, interest rates, political rhetoric and other global risk factors have slowed down growth.
“Consumers are in good financial shape and retailers expect a strong holiday season,” he said. “However, confidence could be eroded by continued deterioration of these and other variables.”
The NRF also expects online and other non-store sales, which are included in the total, to increase 11 to 14 percent to between $162.6 billion and $166.9 billion, up from $146.5 billion last year.
Despite trade uncertainty and a tight labor market, retailers are hiring extra staff to meet the holiday season demand. NRF expects retailers to hire between 530,000 and 590,000 temporary workers, which compares with 554,000 in 2018.
Individually, consumers are projected to spend an average of $1,047.83, up 4 percent from the $1,007.24 they said they would spend during last year’s holiday season. Generation X shoppers, between the ages of 35 and 44, plan to spend the most at $1,158.63.
Consumers will spend in three main categories – gifts for family, friends and co-workers, at an average $658.55; non-gift holiday items such as candy and food, decorations, greeting cards and flowers at $227.26; and other non-gift purchases that take advantage of deals and promotions throughout the season at $162.02.
“Younger consumers are helping drive the spending increase this year,” said Phil Rist, executive v.p. of strategy for survey partner Prosper Insights Analytics. “They’re not just spending on their immediate family members, they’re also treating their larger circle of co-workers and friends to gifts.”
Just over half of shoppers between the ages of 25 and 34 (52 percent) plan to purchase gifts for co-workers, and 82 percent of those between 18 and 24 plan to purchase gifts for their friends.
Similar to previous years, 39 percent of holiday shoppers said they would start buying holiday items before November, while 43 percent are waiting until at least November and 18 percent are waiting until December.
As for Thanksgiving weekend, one of the busiest shopping periods of the season, NRF estimated 165.3 million people shopped between Thursday and Cyber Monday.
“The tradition of Thanksgiving weekend holiday shopping has become a five-day event with consumers spending money in stores, supporting local small businesses, and online with their mobile devices and computers,” Shay said. “Even as people are starting to purchase gifts earlier in the season, consumers still enjoy finding good Thanksgiving deals and passing time shopping with family and friends over the long holiday weekend.”
Surveyed consumers cited the following reasons for hitting online and brick-and-mortar stores over Thanksgiving:
- The deals are too good to pass up (65 percent)
- Tradition (28 percent)
- It's when they like to start their holiday shopping (22 percent)
- It's something to do over the holiday (21 percent)
- It's a group activity with friends/family (17 percent)
And similar to recent years, clothing and accessories are the top gift category this year, purchased by 58 percent of those surveyed, followed by gift cards (54 percent), toys (39 percent), books/music/movies/video games (37 percent) and food/candy (32 percent).