Despite some headwinds, a strong labor market is expected to keep the American shopper busy this holiday season. Retail forecasters predicted this week that holiday sales would grow thiꦯs year at a pace exceeding pre-pandemic levels.

The 澳洲幸运5开奖号码历史查询:National Retail Federation (NRF) said Thursday that it expects 2023 holiday sales to grow 3% to 4%, reaching total spending of between $960 billion and $966 billion. This would set a new record above the $930 billion seen in 2022. While the forecast doesn't eclipse last year's 5% growth rate, the predicted rise would be higher than the approximate 3.6% holiday sales growth that retailers saw from 2010 to 2019.

"We're looking at consumer behavior and economic activity that was slightly better than pre-pandemic averages," said Matthew Shay, president and CEO at NRF. "In spite of the uncertainty and challenges that households are facing, we've seen strength and resilience in the consumer sector."

Other trends that the NRF foresees this season include a 7% to 9% jump in online sales, with 58% of shoppers planning to buy items online. Shoppers plan to spend an average of $875 on holiday purchases this year, in line with their budgets over the past five years.

Jobs Growth Driving Spending

The reasons that consumers keep spen🌃ding come down to jobs, according to officials from the NRF and Bank of America, which both issued forecasts this week calling for a strong holiday season.

"As long as the job market is as strong as it is, their actions are going to continue to power the economy," Shay said. "Their actions are really confidence about the labor market and wages. Inflation is on their mind, and they worry about it and think things aren't great, but they go out and spend money, because they have jobs and are getting wage increases."

The labor market and consumer spending have remained resilient even as the Federal Reserve has steadily raised interest rates in an effort to tame inflation. On Friday, data released by the Bureau of Labor Statistics showed that ﷽澳洲幸运5开奖号码历史查询:employers added 150,000 jobs in October, which was lower than economists had expected. The unemployment rate, at 3.9%, hit its highest level since January 2022, though it's still quite low by historical standards.

Nearly Half of Consumers Plꦛan to Boost Holiday Spending

Nearly half of American shoppers plan to increase their holiday sౠpending this year. This is one of several economic indicators that point to a solid holiday shopping season, Bank of America said.

"Expect a solid holiday spending season this year—potentially a better spending year than last," said Aditya Bhave, senior U.S. economist at BofA Securities.

The Bank of America survey showed that 48% of American holiday shoppers are expected to spend more this year than last, with another 34% expecting their spending to be on par with last year, 10% expecting to spend less, and another 8% unsure of their spending.🧔

Bhave broke down 澳洲幸运5开奖号码历史查询:consumer sentiment into three elements, as consumers ask themselves how they feel about their jobs, their personal balan🌌ce sheet, and prices. All together, this analysis paints a pretty optimistic picture, the economist said.

"We don't see signs of stress among consumers," Bhave noted.

Mortgage rates could be another factor fueling the spending. Since many Americans locked in low rates, they feel more free to spend, Bhave said. While mortgage rates have gone up about 500 澳洲幸运5开奖号码历史查询:basis points, the effective mortgage rate—taking the average mortgage rate across the nation—has increased only about 🐼25 basis points.

"This is how powerful that lock-in effect is, and that is one of the big reasons that credit tightening hasn't affected the market as much as expected," Bhave said.

Headwinds Persist but Aren't Strong Enough to Slow Shoppers Down

Headwinds include rising gasoline costs, increasing use of credit, drops in consumer savings, and the persistent pressure of inflation. While these are issues that cause consumers to lack confidence in the economy, Shay said that they weren't enough to derail the consumer, especially with continued job growth.

While consumer debt is a concern, data shows that, by historical standards, delinquencies aren't high and the amount of consumer debt compared with disposable income remains low. Even 澳洲幸运5开奖号码历史查询:student loan debt worries could be o✃verblown, Bhave said, noting that figures show most of the debt is ow🅰ed by people with the capacity to pay it back.