Retail trade group sees holiday sales rising 3.8% to 4.2% this year, citing ‘uncertainty over trade’
Holiday retail sales in November and December — excluding automobiles, gasoline and restaurants — are expected to increase between 3.8% and 4.2% this year, reaching between $727.9 billion and $730.7 billion, the National Retail Federation said on Thursday morning.
The retail trade group cited “uncertainty over trade” as being a potential drag on the season this year, as the U.S. and China are set to resume trade talks later this month. NRF’s sales range sits below some other forecasts from retail industry consultants, which are calling for growth of upwards of 5%.
The group said holiday retail sales have increased an average of 3.7% over the past five years.
It said it’s expecting online and other non-store sales in 2019, which are included in its total forecast, to climb between 11% and 14%, amounting to between $162.6 billion and $166.9 billion.
“There has clearly been a slowdown brought on by considerable uncertainty around issues including trade, interest rates, global risk factors and political rhetoric,” NRF CEO Matt Shay said in a statement. “Consumers are in good financial shape and retailers expect a strong holiday season. However, confidence could be eroded by continued deterioration of these and other variables.”
In 2018, according to NRF, holiday sales climbed just 2.1%, missing expected growth of between 4.3% and 4.8%. A rocky stock market was called out for weighing on consumer spending, particularly among wealthier shoppers.
NRF has, meanwhile, been a loud voice for retailers arguing against additional tariffs taking effect. Shay said last month: “This trade war has gone on far too long, and the harmful consequences for American businesses and consumers continue to grow.”
The group expects that tariffs will lead to higher consumer prices, which ultimately hurt consumer spending.
NRF’s chief economist Jack Kleinhenz said Thursday: “There are probably very few precedents for this uncertain macroeconomic environment. ... There are many moving parts and lots of distractions that make predictions difficult.”
NRF said a September survey found 79% of consumers were concerned about tariffs leading to price hikes and impacting their shopping.
NRF is also calling for retailers to hire between 530,000 and 590,000 seasonal workers this year, compared with 554,000 in 2018. Macy’s on Thursday announced it plans to hire 80,000 temporary workers for the holidays, in line with its goals in 2018.