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January 18, 2023

NRF: Holiday Sales Growth Short of Forecast

Posted In: Retail Articles
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With consumers pressured by economic uncertainty, higher interest and inflation eroding their incomes, retail sales during 2022’s November-December holiday season grew 5.3% over the 2021 period to $936.3 billion but fell short of the National Retail Federation’s forecast, the organization announced.

For the full year, retail sales grew 7% versus 2023 to $4.9 trillion, meeting NRF’s forecast. NRF forecast 2022 holiday retail sales to increase between 6% and 8% over 2021 to a total between $942.6 billion and $960.4 billion. The 2022 gains compare with 4.9% average annual holiday sales growth over the previous 10 years.

NRF sales figures exclude results from automobile dealers, gasoline stations and restaurants to focus on core retail. It defines the holiday season as November 1 through December 31.

The NRF holiday calculations are not adjusted for inflation. Among the stronger sectors in the holiday season, online and other non-store sales gained 9.5% to $261.6 billion. Still, NRF forecast category growth between 10% and 12% versus the 2021 period to between $262.8 billion and $267.6 billion.

For the month of December, retail sales slipped  0.6% seasonally adjusted from November but were up 5% unadjusted year over year. Sales fell 0.5% month over month in November after a surge of early holiday shopping in October but were up 5.6% year over year.

NRF’s numbers were up 5.6% on a three-month moving average as of December.

NRF’s calculation is based on data from the United States Census Bureau, which announced that overall retail sales in December, including autos, gas and restaurants, slid 1.1% from November but increased 6% year over year. In November, the Census Bureau numbers were down 1% month over month versus October but also gained 6% year over year.

For the two months combined, on an unadjusted year-over-year basis, sector sales were: 

  • Online and other non-store sales up 9.5%
  • Grocery and beverage stores up 7.8%
  • General merchandise stores up 3.8%
  • Sporting goods stores up 3.5%
  • Health and personal care stores up 2.8
  • Clothing and clothing accessory stores up 2.2%
  • Building materials and garden supply stores up 1.5%
  • Furniture and home furnishings stores down 1.1%
  • Electronics and appliance stores down 5.7%

“The last two years of retail sales have been unprecedented, and no one ever thought it was sustainable,” NRF president and CEO Matthew Shay said, in announcing the holiday results. “Nonetheless, we closed out 2022 with impressive annual retail sales and a respectable holiday season despite historic levels of inflation and interest rate hikes to cool the economy. Consumers shopped in record numbers and retailers delivered positive holiday experiences to inflation-wary consumers, offering great products at more promotional price levels to fit their stretched budgets. The fact that we saw retail sales growth on top of December’s 14% gain in 2022 shows the resilience of consumers and the creativity of retailers in driving consumption and economic activity while addressing high inflation and continued cost pressures.”

NRF chief economist Jack Kleinhenz, added, “We knew it could be touch-and-go for final holiday sales given early shopping in October that likely pulled some sales forward plus price pressures and cold, stormy weather. The pace of spending was choppy, and consumers may have pulled back more than we had hoped, but these numbers show that they navigated a challenging, inflation-driven environment reasonably well. The bottom line is that consumers are still engaged and shopping despite everything happening around them.”

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