Reuters / SARAH SILBIGER
It is currently 57 days till Hanukkah, 64 days till Christmas, and 70 days till the new year, meaning stores and brands have started their countdown to the holidays. This year might be different for consumers because rising U.S. inflation rates and predicted recession impact shoppers’ willingness to buy.
A recent holiday retail report by consulting firm Deloitte found that American consumers plan to spend less this holiday season and focus more on discounts and deals. The report found holiday shoppers will spend close to around $1,455 on purchases this season, similar to last year’s numbers, but noted growing consumer anxiety. Consumers plan to purchase fewer gifts this year for loved ones, considering rising prices.
Inflation increased by 0.4% in September and is up 8.2% from a year ago. The rise was higher than expected as the Federal Reserve instituted rate hikes and is expected to enact more in November and December to bring relief to consumers.
A report by BlackFriday.com found that 70% of U.S. consumers are planning on considering inflation rates when planning their holiday shopping. Still, Bank of America and American Express reported strong third-quarter earnings on Friday.
Some retailers are taking precautionary steps and starting holiday sales in October. Walmart, Target, and Amazon have all held large seasonal sales this month, with more deals coming as the holidays near.
While the advertisement of sales increases, retailers are facing increased stress. Walmart is hiring fewer seasonal employees than in years past, and Amazon has instituted a corporate hiring freeze for retail for the remainder of 2022. Foot traffic in department stores is down from the past year and is not close to reaching pre-pandemic levels.
