The National Retail Federation predicts a historical holiday season this year despite several economic drawbacks, including massive layoffs, government shutdown and furloughs, FAA shortages, and imposed tariffs. The report defines the holiday season from November 1st to December 31st. The NRF’s holiday forecast is based on key economic factors such as consumer spending, disposable income employment wages, inflation, and earlier monthly retail sales releases. The calculation excludes automobile dealers, gasoline stations and restaurants.
“The economy has shown surprising resilience in a year marked by trade uncertainty and persistent inflation.” NRF’s President and CEO Matthew Shay said.
Lone Star College Economics Professor, Hank Lewis, says from the report its unclear if the predicted increase reflects adjusted inflation adjusted or not. “It could be that yes, its higher, but that could be because there being higher prices of various goods and services. Part of me also wonders if some of this might be wishful thinking, because we are looking at massive layoffs in the tech and retail industries.” Lewis said.
He says the government shutdown will usually raise uncertainty in spending causing a downward turn and that would lead to a recession in the economy, which we don’t want.
Lewis recommends making a budget and spending wisely this season. “Check yourself, look at your foundation, make your mortgage, save for a rainy day. Stay within your budget, stick to it, and be careful using the short-term credit payment plans, like Klarna and Affirm- because there is interest attached to them. People use their credit card instead of a debit card, so they don’t really get the savings they think they’re going to get.” Lewis said.
Despite the tumultuous year Americans have endured this year, we always seem to find a way to embrace the holiday season with family and friends and can't seem to avoid holiday deals turning into holiday debt, holiday food and fun that leads to New Year's resolutions in January.