The Washington, D.C., based trade organization's 2002 Survey of Consumer Intentions and Actions predicts a 4 percent increase in consumer spending during the holiday shopping season, which traditionally begins the day after Thanksgiving. This year's survey results approximate the 2000 holiday shopping season, which saw a 4.3 percent gain. Last year, according to NRF information, holiday sales were up 5.6 percent.
"We are projecting an additional $8 billion sells this year, for a total of up to $209 billion during the holiday shopping season," said NRF spokeswoman Ellen Tolley, adding that more than 7,500 consumers were surveyed by the Ohio-based BIGresearch, which conducted the survey in October.
NRF defines "holiday retail sales" as sales in November and December for general merchandise stores, clothing and clothing accessories stores, furniture and home furnishings stores, electronics and appliance stores and sporting goods, hobby, book and music stores.
The survey could be good news for cities across the United States that have been feeling the pinch of recession and slow revenue growth since the Sept. 11 terrorist attacks. An informal survey of city officials across the United States shows that they are predicting increased retail sales and tax collections from the Christmas shopping season.
The Charleston, S.C., Chamber of Commerce's Center for Business Research conducted its own survey of holiday spending trends in the Charleston metropolitan area.
"Our research indicates Charleston will see a 7 percent increase in spending over the holiday shopping season, $3.4 billion more than last year, and a corresponding 7 percent increase in sales tax revenue," said Jackie Renegar, a spokeswoman of the Center for Business Research.
To date, Renegar said, retail sells are up 6 percent in Charleston, and that she believes the trend will continue into 2003.
In Hattiesburg Miss., a town of 50,000 in the southern part of the state and home to state's third largest public university, Mayor Johnny Dupree is also expecting a hefty sales tax check from the holiday shopping season.
"Last December, we received about $1.6 million in sales tax," Dupree said. "It was the largest sales tax check the city had ever received. This year, we predict to increase that amount by about $100,000. We have a large retail community here and we are regional shopping center, located close to the Mississippi Gulf Coast, the state capital in Jackson, Mobile, Ala., and New Orleans."
Big Picture Less Rosy
The National League of Cities' 2002 City Fiscal Conditions Survey showed that 55 percent of municipal financial officers believed that their cities would be less able to meet financial needs in the current fiscal year as compared to the previous fiscal year.
The survey also showed significant decreases in sales-tax, tourist-tax and income-tax collections from the second quarter of fiscal year 2001 to the first quarter of fiscal year 2002. Sales tax collections, which had been fairly consistent at 98 percent to 102 percent of budgeted amounts prior to the third quarter of 2001, dropped to 94 percent in that quarter and to 92 percent in the first quarter of 2002.
Michael Pagano, a professor of public administration at the College of Urban Planning and Public Affairs at the University of Illinois, said the NRF's survey -- and predictions of increased sales tax collections by some city officials -- could be good news for cities. But it doesn't necessarily mean that true economic recovery has begun.
"If the [NRF] survey results hold true, then the holiday shopping season will help cities, but by how much, I can't say," Pagano said. "That depends on how badly they've suffered through this year. Some cities have put hiring freezes on vacant positions and others have laid off employees. If there is a very nice spending spree in December, that may help reduce the rate of lay offs in some cities and help fill some of those frozen positions.
"The damage to the economy from 9/11 and the recession have been felt by cities throughout the year, and at this point, it is impossible to tell if a strong holiday shopping season is an economic hiccup or the beginning of a true upward trend in the economy," said Pagano, who prepared the report for NLC based on the City Fiscal Conditions survey.
Tolley said the NRF's survey takes into account how much consumers plan to spend during the holidays, when consumers plan to shop and whether they will take advantage of sales and discounts at stores.
"This year, consumers said that, on average, they'll spend about $656 during the holidays on gifts, decorations, food and other items," Tolley said. "That's up from $632 last year. About 55 percent of the consumers surveyed said they plan to take advantage of sales and discounts offered at stores, and many of those will also make impulse purchases, which means they'll probably spend more than they said."
