Retailers have good reason to feel festive this year.
According to Deloitte’s annual holiday shopping forecast, released Wednesday, shoppers are poised to spend big this coming season. The consulting firm expects U.S. retail sales to rise between 5 and 5.6 percent, potentially topping $1.1 trillion between November and January.
With consumer confidence high and unemployment low — and retailers pulling out all the stops — Americans will likely up their shopping both in stores and online. E-commerce sales, per Deloitte, are expected to rise between 17 and 22 percent for the holiday season, compared with the 16 percent they rose last year. In total, they could reach $128 to $134 billion this year, or around 12 percent of total seasonal spend.
“Consumer sentiment and spending indicators provide a healthy outlook for retailers across channels, with strong expectations for store-based and online retailers,” said Rod Sides, Deloitte’s vice chairman and U.S. retail and distribution sector leader. “We’ve seen retailers continue to advance their approaches to shipping, delivery, in-store experiences and tech-enabled commerce … The leading retailers this holiday season could be the ones who are able to strike the right balance between innovation, experience and value that best engages the consumer and stands out in a busy season.”
Still, it’s too early to consider the predicted windfall a done deal: The firm’s economists warn that a correction in the stock market, political turmoil or the effects of an interest rate hike by the Federal Reserve could all impact spending.
Of course, that hasn’t stopped retailers from staffing up to handle the expected deluge of customers: Kohl’s started hiring seasonal employees in June to get ahead of the rush, taking into account the tight labor market and stiff competition from rivals who also are also seeking to hire tens of thousands of workers. Macy’s has touted its incentive plan, which gives part-time workers the opportunity to earn performance-based bonuses, while JCPenney has said it will offer paid time off, paid training and 401(k) benefits to certain eligible seasonal employees.