Deloitte’s economists and retail analysts forecast that the steadily improving U.S. economy should boost holiday sales in stores and online this season.
The professional services firm expects retail sales from November to January to rise by 4 percent to 4.5 percent, to between $981 billion and $986 billion, which would be an improvement over last season's 2.8 percent gain.
"Income, wage and job growth are positive indicators heading into the holiday season," says Daniel Bachman, Deloitte's senior U.S. economist, in the report. "Debt levels remain at historical lows, and stock market gains coupled with increasing home prices have a wealth effect on consumers, which may encourage increased spending compared with prior years."
Wage growth has largely remained stagnant throughout the economic recovery, rising just above inflation, but gradually falling unemployment should accelerate wage growth in the second half of this year, predicts Paul Ashworth, chief North American economist at Capital Economics.
Gasoline prices, which spiked near the start of the conflicts in Ukraine and Iraq, have in recent months leveled off. If they continue to hold steady, Bachman reasons that it would sustain consumers’ spending power this fall.
Deloitte forecasts that digital interactions, such as using a mobile phone to compare prices in a store, will influence half of retail sales this holiday season.
“Our research indicates that 84 percent of shoppers use digital tools before and during their trip to a store,” says Alison Paul, a vice chairman at Deloitte and the firm's U.S. retail and distribution leader. “Additionally, those shoppers convert, or make a purchase, at a 40 percent higher rate than those who do not use such devices during their shopping journey.”