Holiday Retail Buying Falls Behind 2008 Pace

Holiday sales seemed to be off to a promising start. Online research firms including comScore said that e-commerce sales were up 3% to 4% through the first week of December. The government said store-based shopping was up more than 1% in November and retail industry groups claimed that trend was continuing early into this month.

The first detailed research on shopping through mid-December, based on data gathered by the National Retail Federation, shows that consumers “on average” had completed 46.7% of their shopping by the end of the second week of December. That compares to 47.1% at the same time last year.

According to Reuters, the numbers are the worst since the 2004 shopping season.

The figures almost certainly point to one of two trends. The first is that shoppers are hoping that desperate retailers will drop their prices closer to Christmas as a way to clear inventory that will not be salable after New Year’s. The second is that shoppers believe that the economy is not recovering and that many jobs are still at risk. Several recent polls show that, while economists have said the recession is over, most of the general population does not believe it. Worried people may simply stay away from store altogether

The news from the NRF is bad if it points to a slowing of sales throughout the holidays. Last year’s numbers were bad enough that a thousands of stores closed and tens of thousands of retail workers lost their jobs. It would not be a good omen for a 2010 economic recovery if that happens again this year.

Douglas A. McIntyre