A strong economy has retailers expecting a healthy holiday shopping season in November and December, according to a report released Thursday by the National Retail Federation.
It’s an optimistic outlook also shared by many retailers in Nevada, but concerns remain over the potential effects of import tariffs, spokesmen for the national and state trade associations indicated.
The industry trade group predicted holiday sales to climb between 3.8 percent to 4.2 percent compared with last year for a total between $727.9 billion and $730.7 billion. The numbers exclude auto dealers, gas stations and restaurants.
Matthew Shay, the retail federation’s president and chief executive officer, said the organization is optimistic though another round of import tariffs, expected to hit the industry mid-December, is causing concern.
“It’s a strong forecast despite all that uncertainty,” Shay said during a media call. “The fundamentals underlying the economy — low unemployment, growing wages, consumer confidence — are going to provide a great deal of momentum, and that’s going to continue into the third and fourth quarter, which includes the holiday season.”
The organization also said retailers are expected to hire between 530,000 to 590,000 seasonal workers compared with 554,000 last year.
Breaking out online and other non-store sales, those should increase between 11 percent and 14 percent this year to between $162.6 billion and $166.9 billion, up from $146.5 billion last year.
Holiday sales in 2018 reached $701.2 billion, up slightly by 2.1 percent year-over-year. The “unusually small” bump was likely because of factors including a government shutdown, market volatility and an escalating trade war with China, according to the organization.
Retailers in Nevada also might see a boost in sales this shopping season.
“I think we can expect an increase in sales from last year,” said Bryan Wachter, Retail Association of Nevada’s senior vice president of government and public affairs.
The association will release its local holiday sales forecast next week, but Wachter said many of the concerns around import tariffs expressed in the retail federation’s report have been echoed by its own members.
“Small businesses are less able to ride out a price increase,” he said. “Do you absorb that cost increase? Do you choose to pass that along to the consumer, who has unlimited options of where to get their products, or do you start letting employees go? How does a business owner absorb that cost — that’s certainly something our smaller members are facing.”
A 15 percent tariff on roughly $300 billion of Chinese consumer goods and products by the Trump administration is happening in two phases, Sept. 1 and Dec. 15. The second phase was added after retailers voiced their concerns about the effect duties could have on holiday sales.
Wachter said President Donald Trump’s decision to delay a portion of the tariffs on imported Chinese goods signals concern over the impact potential price increases on consumers in the coming months.
“We’re talking about changes so far down the supply stream that it does take a couple cycles for it to get to the (consumer), but I think it’s an unnecessary hindrance to what could be a more successful holiday season,” he said.