Hard to believe, but it’s almost Christmas. And, of course, with Christmas comes Christmas shopping, which is so important to many retailers. N.C. State University economist Mike Walden discusses what economists are saying about the outlook for holiday sales this year.
“Well, before the holiday buying period began …, people like economists thought that sales would be up. They might be up about 3 to 5 percent over last year, so that’s good. But last year they were up between 5 and 6 percent. So we were looking for a gain but not quite as good of a gain as last year.
“So far, we have some preliminary numbers. Christmas buying season isn’t over yet, but so far we have some preliminary numbers that suggest that spending is way ahead of those forecasts. So we may be pleasantly surprised.
“And if we are pleasantly surprised, of course, the question is, Why? Well, I think there are actually several positives in the economy right now. We have had slightly faster job growth. The recent job reports both for the nation and for North Carolina were very good. Gas prices are going down. People, I think, always look at gas, spending on gas as an alternative spending on other things. So if they’re spending less on gas, they can afford to buy more presents, for example. Consumer confidence is up. The housing market is improving. Household wealth is up. So we clearly have a lot of negatives out there, but we also have a lot of positives.
“And the last thing I might say here is that consumers have actually been very frugal with their spending over the last four years. And I think maybe with some of these positives in the economy that might tell people, ‘Hey, I’m going to bust out. I’m going to really have a good Christmas. I’ve scrimped and saved the last few. I’m going to have a really good one this year.’
“So we will wait and see when the final numbers are in, but right now it looks like we could be pleasantly surprised.”Category: Economic Perspective