US Holiday Shopping Sees Modesty Prevail

26 November 2004

With the US Thanksgiving holiday in full swing retailers are hoping shoppers will loosen their purse strings and spend.

Economic indicators have shown a steady improvement following a dismal spring and summer. Retail chain store sales rose 1.3% in September and 0.8% in October. There were also 337,000 new jobs available last month, the most since March.

The influential University of Michigan's index of consumer confidence also rose in November, after falling for three months in a row. And consumers now seem to be accustomed to higher fuel prices.

Says Tracy Mullin, chief executive of the National Retail Federation: "Things seem to be improving. We will have a solid holiday season, but not a spectacular one."

Peter Gioia, an economist at the Connecticut Business and Industry Association, concurs: "The economy continues to move along and grow. My guess is that we'll have moderate growth for sales in the holiday season. I see nothing that tells me we'll have an outstanding season."

A survey by the Consumer Federation of America and the Credit Union National Association found consumers themselves were feeling happier about holiday shopping than last year.

This year, 32% of respondents said they would cut spending, slightly less than the 34% who said so in 2003. Moreover, 17% of those surveyed said they would buy more - the highest level since 2000.

Data sourced from New York Times; additional content by WARC staff