Holiday Retail Forecast is Most Optimistic Since Recession
Oct 5, 2012
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The National Retail Federation's 2012 holiday forecast is higher than the 10-year average holiday sales increase of 3.5%. NRF forecasts 2012 holiday sales to be up 4.1% to $586.1 billion.
NRF's "holiday sales" category includes retail industry sales in the months of November and December. It includes most traditional retail categories and excludes sales at automotive dealers, gas stations, and restaurants. Actual holiday sales in 2011 grew 5.6%.
"This is the most optimistic forecast NRF has released since the recession. In spite of the uncertainties that exist in our economy and among consumers, we believe we'll see solid holiday sales growth this year," said NRF President and CEO Matthew Shay. "Variables including an upcoming presidential election, confusion surrounding the 'fiscal cliff,' and concern relating to future economic growth could all combine to affect consumers' spending plans, but overall we are optimistic that retailers promotions will hit the right chord with holiday shoppers."
NRF said recent government data shows a crosscurrent of indicators that could impact holiday sales, including unimpressive job and income growth and an unemployment rate stuck at 8%. But positive indicators are emerging that show a "cautious but capable consumer." These indicators include improvements in confidence and home prices.
"While moderate compared to what we experienced the last two holiday seasons, the forecast is a very pragmatic look at what to expect this year given the current rate of economic growth," said NRF Chief Economist Jack Kleinhenz, Ph.D. "There's still some general anxiety amongst consumers when it comes to how the state of the economy is impacting their spending plans, but retailers can expect to see excitement around their promotions and plenty of bargain hunters both online and in stores in the coming months."
NRF's holiday sales forecast is based on an economic model using several indicators including consumer confidence, consumer credit, disposable personal income, and previous monthly retail sales releases. It now includes the non-store category (direct-to-consumer, kiosks and online sales.)
Shop.org released its first-ever online holiday sales forecast. The forecast calls for 2012 online holiday (November/December) sales to grow 12% over last holiday season, to as much as $96 billion. The U.S. Department of Commerce estimates that 2011 fourth quarter e-commerce sales were up 15%.
"Online retail has been a bright spot for years and we don't expect that trend to change anytime soon, especially with the growth in mobile," stated Shay. "Aside from the convenience, shoppers look to the holiday season to take advantage of retailers' increased digital offerings. In addition to enhancing the site experience, retailers have spent the year investing in optimizing their mobile and social platforms, just what holiday shoppers are looking for."
NRF expects retailers to hire between 585,000 and 625,000 seasonal workers in the 2012 holiday season, making it comparable to the 607,500 seasonal employees hired for 2011.
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