Holiday sales expected to jump 4.1 percent

Freeman Staff

Oct. 8, 2014

WASHINGTON - Following a shaky start to 2014, the National Retail Federation announced Tuesday it expects sales in November and December to increase a by 4.1 percent - up to $616.9 billion.

The numbers - which exclude automobile, gas and restaurant sales - would be a step up from the 3.1 percent increase over the same time period last year.

The federation’s forecast is based on an economic model that focuses on indicators such as disposable personal income, consumer credit and previous monthly retail sales releases.

“Retailers could see a welcome boost in holiday shopping, giving some companies the shot in the arm they need after a volatile first half of the year and an uneventful summer,” NRF President and CEO Matthew Shay said. “While expectations for sales growth are upbeat, it goes without saying there still remains some uneasiness and anxiety among consumers when it comes to their purchase decisions.”

Shay added that, while improving, the lagging economic recovery is still on the minds of many American shoppers.

While consumer confidence has been unstable in 2014,recent  improvements in key economic indicators will give way to increased spending power among holiday shoppers, according to the forecast.

““Though we have only seen consumer income and spending moderately - and erratically - accelerate this year, we believe there is still room for optimism this holiday season,” said NRF Chief Economist Jack Kleinhenz. “In the grand scheme of things, consumers are in a much better place than they were this time last year, and the extra spending power could very well translate into solid holiday sales growth for retailers.”

On average, holiday sales have grown by 2.9 percent over the past 10 years, including this year’s estimate, and should represent approximately 19.2 percent of the retail industry’s total of $3.2 trillion in sales.