Holiday Retail Sales in Trouble Over Black Friday Weekend

By Douglas A. McIntyre Updated Dec 1, 6:12AM EST · Published Dec 1, 5:07AM EST

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The National Retail Federation (NRF), an association that represents the nation’s largest retailers, reported that the Black Friday weekend was a disaster. The information bodes poorly for the balance of the holiday, one in which many weak retailers needed to post strong earnings to remain viable. And temporary workers hired by retailers and who hoped for full-time employment are in trouble.

According to the NRF:

WASHINGTON, November 30, 2014 — Early holiday promotions, the continued growth of online shopping, and an improving economy changed the way millions of people approached the biggest shopping weekend of the year. According to NRF’s Thanksgiving Weekend Spending Survey conducted by Prosper Insights & Analytics, 55.1 percent of holiday shoppers were or will be in stores and online over Thanksgiving weekend, down from 58.7 percent last year. Overall shopper traffic from Thanksgiving Day through Sunday, November 30 dropped 5.2 percent from 2013 (133.7 million unique holiday shoppers versus 141.1 million in 2013). Total shopping, including multiple trips by the same shopper, was also down this weekend (233.3 million versus 248.6 million). This is the 11th survey NRF has released in partnership with Prosper.

And:

According to the survey the average person who shopped or will shop the holiday weekend will spend $380.95, down 6.4 percent from $407.02 last year. Total spending is expected to reach $50.9 billion, down from last year’s estimated $57.4 billion. Additionally, more than three-quarters (77.2%) say they took advantage of retailers’ online and in-store promotions to buy non-gift items for themselves or their family, similar to last year’s 76.4 percent.

In other words, even people who shopped were stingy. The amount spent per person is another reflection about whether Americans are optimistic about the economy. Despite improvement in the jobs picture, people remain anxious.

E-commerce numbers were just as depressing:

Holiday shoppers weren’t only in stores on Thanksgiving, they were also online, though it seems early online promotions before the big weekend may have taken some of consumer’s spending power with them. According to the survey the average person who shopped over the weekend spent $159.55 online, approximately 41.9 percent of their total average budget, down 10.2 percent from $177.67 last year.

While healthy retailers like Amazon.com Inc. (NASDAQ: AMZN) and Macy’s Inc. (NYSE: M) may be hurt by the drop, some retailers may barely survive it. Sears Holdings Corp. (NASDAQ: SHLD) and J.C. Penney Co. Inc. (NYSE: JCP) needed a holiday season in which a rising tide lifted all boats.

Finally, the news is bad for the hundreds of thousands of temporary employees hired by retailers for the holidays. For many, the opportunity was a path to a full-time job. The path apparently has been blocked.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.