Retailers in the US felt more pressure this year due to the shorter holiday shopping period, but ended the season with increased sales.
Sales surged this year during the holiday shopping season, even as Americans grappled with high prices on many foods and other necessities, new data revealed.
Holiday sales from early November through Christmas Eve rose 3.8%, surpassing the previous year's 3.1% increase, reported Mastercard SpendingPulse, which tracks all types of payments, including cash and debit cards. The last five days of the season accounted for 10% of spending.
This year, retailers were even more pressured to get the public to buy early and in large quantities, as there were five fewer days between Thanksgiving and Christmas.
Michelle Meyer, chief economist at the Mastercard Institute of Economics, said the holiday shopping season “revealed a consumer who can and wants to spend, but is driven by the search for value,” as seen in concentrated online spending during the most important promotional periods.
The sales growth was greater than the 3.2% increase Mastercard SpendingPulse projected this fall. The data released Thursday excludes the auto industry and is not adjusted for inflation.
Apparel sales rose 3.6%, with most of the growth driven by online shopping. Restaurant spending and sales of electronics and jewelry also grew. Online sales increased 6.7% from a year ago and in-person spending increased 2.9%.
Consumer spending accounts for nearly 70% of U.S. economic activity, and economists carefully monitor how Americans use their money, especially during the holidays, to gauge how they feel financially.
The government's most recent data on consumer spending, released Dec. 17, showed that shoppers increased activity in retail stores last month.
But auto dealer sales drove most of those gains, as massive storms created a need for new cars in parts of the Southeast hit by Hurricane Helene in October. Deep discounts at many retail chains also attracted shoppers.
However, the report also hinted at some caution on the part of consumers, as sales at grocery stores, clothing stores and restaurants fell. Outside of auto dealerships and online retailers, sales gains were modest.
Retailers felt more pressure this year because of the shorter holiday shopping period, and also because of a presidential election that captured the attention of many consumers.
General merchandise sales fell 9% in the two weeks ending Nov. 9, according to Circana, a market research group. Sales have been recovering, but stores will have to make up for those losses.
A bigger picture of how Americans are spending their money will come next month when the National Retail Federation, the nation's largest retail trade group, releases its combined two-month statistics based on November-December sales figures. of the Department of Commerce.
Overall, retailers are off to a decent start for the unofficial start of the Christmas shopping period despite many discounts that began even in October.