US retail sales are expected to grow during this year’s holiday season despite the raging pandemic putting a damper on Thanksgiving and Christmas festivities.
Holiday sales this November and December are estimated to rise some 3.6% to 5.2% from last year to reach $755.3 billion-$766.7 billion this year, according to the National Retail Federation (NRF).
Retail sales in 2019 came in at $729.1 billion, up 4% from the previous year, said the US’ largest retail trade association.
Despite the coronavirus pandemic, the rise in holiday sales would come “as retailers have planned ahead by investing billions of dollars to ensure the health and safety of their employees and customers,” federation President and CEO Matthew Shay said in a statement.
A major factor for the expected rise in holiday spending is psychological for US consumers, according to Jack Kleinhenz, the federation’s chief economist.
“Consumers have experienced a difficult year … After all they’ve been through, we think there’s going to be a psychological factor that they owe it to themselves and their families to have a better-than-normal holiday,” he said.
Another factor Kleinhenz noted is consumer spending on personal services, such as travel and entertainment, remaining low due to COVID-19, and this has freed up some money for Americans to spend on retail.
Since most US consumers will choose online purchases instead of in-store shopping, the federation said it forecasts online and other non-store sales to jump some 20%-30% from 2019 to reach $202.5 billion-$218.4 billion this year.
E-commerce sales in US were up 36.7% in the third quarter of 2020, compared to same period a year ago, the federation said, adding: “Many households are expected to depend on digital shopping to make many of their holiday purchases.”
Online shopping has been the cornerstone for retail sales around the world in the weak economic environment due to COVID-19, and a number of American billionaires have reaped rewards from this.
Amazon CEO Jeff Bezos, the world’s richest person, saw his net worth rise 80% to $203 billion from this March to October year, according to a study last month by the Institute for Policy Studies and Americans for Tax Fairness.
The study also showed that 644 billionaires in the US saw their total net worth rise by $930.7 billion during the pandemic months.