Consumers are expected to spend $1.01-1.02 trillion in November and December, according to The National Retail Federation’s annual holiday forecast.
This prediction, conducted by Prosper Insights & Analytics, estimates that the sales will be up 3.7-4.2% over 2024 during the holiday season.
“American consumers may be cautious in sentiment, yet remain fundamentally strong and continue to drive U.S. economic activity,” said Matthew Shay, president and CEO of NRF. “We remain bullish about the holiday shopping season and expect that consumers will continue to seek savings in nonessential categories to be able to spend on gifts for loved ones.”
Despite persistent inflation and trade uncertainty, consumers still plan to spend, said NRF’s chief economist and executive director of research Mark Mathews.
The research found that consumers plan to spend $890.49 per person on average this year on holiday gifts, food decorations and other seasonal items. This is the second highest in the survey’s 23-year history. The data looks at spending from Nov. 1-Dec. 31.
As usual retailers will be hiring seasonal workers to support the increased demand during the holiday season, but NRF predicts that they will not hire as many people this year. The association expects retailers to hire 265,000-365,000 seasonal workers, down from 442,000 last year, in response to a slower-paced labor market. A lot of this hiring started in October, but retailers may shift plans based on the ongoing tariff situation and spending patterns.
A notable differentiator this year is the federal government shutdown. Mathews said that delays in federal spending will lead to losses in private sector income, negatively impacting consumer demand. While temporary,these effects will carry over longer than the shutdown lasts.
