In the upcoming holiday season, a National Retail Federation (NRF) survey found that consumers are expected to spend an average of $1,007.24. The figure marks a 4.1 percent increase from last year when consumers said they would spend an average of $967.13, the NRF said in a press release.
NRF President and CEO Matthew Shay said in a press release, “confidence is near an all-time high, unemployment is the lowest we’ve seen in decades and take-home wages are up. All of that is reflected in consumers’ buying plans.”
At the same time, the NRF noted that tariffs took effect last month on consumer goods from China. However, the foundation said the effect on pricing is expected to be minimal because retailers imported “record volumes of merchandise” in the summer, prior to the tariffs taking effect.
The news comes as holiday sales for U.S. retailers are expected to increase 4.8 percent this year. The NRF said that holiday sales growth will be higher than the average increase of 3.9 percent over the past five years. However, sales will grow at a slower pace than the 5.3 percent growth the retail market saw a year ago.
NRF Chief Economist Jack Kleinhenz said, according to Reuters, “Last year’s strong results were thanks to growing wages, stronger employment and higher confidence, complemented by anticipation of tax cuts that led consumers to spend more than expected. With this year’s forecast, we continue to see strong momentum from consumers as they do the heavy lifting in supporting our economy.”
According to the NRF, sales for the last two months of the year are expected to hit between $717.45 billion and $720.89 billion, excluding autos, gasoline and dining out. Holiday sales in 2017 were $687.87 billion. The NRF’s forecast is a closely-watched indicator ahead of the holiday season, with the last two months of the year possibly comprising 20 percent to 40 percent of annual sales for many retailers, including Amazon, Walmart and Target.