Holiday Sales Rise, But Miss Forecasted Growth

Retail sales during the two-month holiday selling season were up 5.3% over 2021, but the rate of growth was below the levels predicted by the National Retail Federation, the association said.

In early November, the NRF forecasted holiday sales growth of between 6% and 8%. Total sales for the final two months of 2022 were $936.3 billion. Consumers during the 2021 holiday season spent $889.3.

NRF’s calculation of retail sales excludes automobile dealers, gasoline stations and restaurants to focus on core retail, and NRF defines the holiday season as Nov. 1 through Dec.31.

“The last two years of retail sales have been unprecedented, and no one ever thought it was sustainable,” said Matthew Shay, president and CEO of the NRF. “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.” 

Jack Kleinhenz, the NRF’s chief economist, noted that the pace of spending during the holidays was “choppy” and consumers appear to have pulled back on spending more than was anticipated.

“But these numbers show that (consumers) navigated a challenging, inflation-driven environment reasonably well,” he said. “The bottom line is that consumers are still engaged and shopping despite everything happening around them.”

The NRF’s holiday total, which is not adjusted for inflation, includes online and other non-store sales, which were up 9.5% at $261.6 billion. NRF had forecast that the category would grow between 10% and 12% to between $262.8 billion and $267.6 billion. Online holiday sales were $238.9 billion in 2021.

For December alone, retail sales as defined by NRF were down 0.6% seasonally adjusted from November but up 5% unadjusted year over year. By comparison, sales were down 0.5% month over month in November after a surge of early holiday shopping in October but up 5.6% year over year. NRF’s numbers were also up 5.6% on a three-month moving average as of December.

November-December holiday sales saw year-over-year gains in all but two of nine retail categories, led by online sales, grocery stores and general merchandise stores. Specifics from key sectors for the two months combined, all on an unadjusted year-over-year basis, include:

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