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NRF Forecasts Holiday Sales Increase of 2.8 Percent to $465.6 Billion
-Retailers Will Hire Estimated 480,000 - 500,000 Seasonal Employees This Year-
Washington, October 6, 2010 – The 2011 holiday season can be summed up in one word: average. On the heels of a holiday season that outperformed most analysts’ expectations, holiday retail sales* for 2011 are expected to increase 2.8 percent to $465.6 billion, according to the National Retail Federation. While that growth is far lower than the 5.2 percent increase retailers experienced last year, it is slightly higher than the ten-year average holiday sales increase of 2.6 percent.**
“Retailers are optimistic that a combination of strong promotions and lean inventory levels will help them address consumer caution this holiday season,” said NRF President and CEO Matthew Shay. “While businesses remain concerned over the viability of the economic recovery, there is no doubt that the retail industry is in a better position this year to handle consumer uncertainty than it was in 2008 and 2009.”
Though several economic indicators paint a solid picture for the holiday season – including 14 consecutive months of retail sales growth and a substantial reduction in household debt – continued consumer uncertainty over the stock market, higher gas and food prices, fiscal policy and sputtering job growth will impact spending this holiday season. Additionally, the substantial year-over-year gains for the 2010 holiday season will create more difficult comparisons for retailers to achieve this year.
“Just when you think the U.S. economy is turning around, another factor comes into play that changes the game,” said NRF Chief Economist Jack Kleinhenz, Ph.D. “Persistently high unemployment, an erratic stock market, modest income growth and rising consumer prices are all combining to impact spending this holiday season. How Americans will react to shaky economic data is the question, but the good news for retailers is that shoppers have not yet thrown in the towel.”
NRF’s holiday sales forecast is developed based on an economic model using several indicators including consumer confidence, consumer credit, disposable personal income and previous monthly retail sales releases.
– NRF Estimates Retailers Will Hire 480,000-500,000 Seasonal Workers –
For the first time this year, NRF used its holiday forecasting model to create a projection for seasonal hiring in retail. According to NRF, retailers are expected to hire between 480,000 and 500,000 seasonal workers this holiday season, which is comparable to the 495,000 seasonal employees they hired last year.*** While most retailers bring in additional employees during the holiday season to account for an uptick in traffic and sales, retailers have also been hiring throughout the last year: Since last August, the retail industry has added nearly 100,000 jobs.
“The hundreds of thousands of jobs created during the holiday season help people support their families by supplementing their household income and providing generous employee discounts,” said NRF President and CEO Matthew Shay. “As the retail industry bounces back from the recession and continues to add jobs, some holiday employees could find themselves with an opportunity for even more: a new career in one of the most innovative industries on the planet.”
PRESS AND ANALYSTS: For more insight on what to expect this holiday season, join NRF for a media briefing today at 2 pm ET with NRF President and CEO Matthew Shay, NRF Chief Economist Jack Kleinhenz, Ph.D., and BIGresearch Senior Analyst Pam Goodfellow. On the call, Kleinhenz will present the rationale and metrics behind NRF’s holiday forecast along with economic expectations for the remainder of 2011. Goodfellow will provide an overview of recent survey data including consumer confidence, credit card spending, and a 90-day financial outlook. Register for the briefing by emailing firstname.lastname@example.org.
As the world’s largest retail trade association and the voice of retail worldwide, NRF’s global membership includes retailers of all sizes, formats and channels of distribution as well as chain restaurants and industry partners from the United States and more than 45 countries abroad. In the U.S., NRF represents an industry that includes more than 3.6 million establishments and which directly and indirectly accounts for 42 million jobs – one in four U.S. jobs. The total U.S. GDP impact of retail is $2.5 trillion annually, and retail is a daily barometer of the health of the nation’s economy. www.nrf.com.
* NRF defines “holiday sales” as retail industry sales in the months of November and December. Retail industry sales include most traditional retail categories including discounters, department stores, grocery stores, and specialty stores, and exclude sales at automotive dealers, gas stations, and restaurants.
** Holiday retail sales for the past eight years have been updated based on revisions from the U.S. Department of Commerce. The most up-to-date statistics on previous holiday season sales numbers and growth can be found on page 6 of NRF’s 2011 Holiday Survival Kit.
*** NRF used the same definition of “retail” to identify historical hiring trends and forecast 2011 seasonal employment. Historical hiring numbers can be found on page 8 of NRF’s 2011 Holiday Survival Kit.