Frugal forecast for holiday gift spending and retail hiring

Backed by forecasts of a lean holiday gift-buying season, the nation's retailers plan to hire about the same number of seasonal workers as last year.

The National Retail Federation today is expected to forecast a modest 2.8 percent increase in general merchandise sales from Thanksgiving to Dec. 31 and said seasonal hiring will be close to last year's 495,000 jobs, short of the 600,000 in pre-recession years.

Hiring intentions vary widely. Macy's, Kohl's and JCPenney each plan to hire at least 5,000 more seasonal workers this year. But Best Buy and Toys "R" Us plan 20,000 fewer jobs, combined.

The 2.8 percent sales gain, which envisions $466 billion in spending, follows an unexpectedly strong 5.2 percent gain to $453 billion in 2010.

Experts pin the frugal mood on nagging unemployment, stock market gyrations, a lack of income growth and higher food and gas prices than a year ago.

"The good news for retailers is that shoppers have not thrown in the towel," said Jack Kleinhenz, chief economist for the trade group.

Meanwhile, holiday gift budgets of affluent shoppers — households living on $125,000 to $250,000 a year — dropped 17 percent from 2010, according to American Express. That could become a big deal, because that group is the bulwark of the top 10 percent of wage-earning families responsible for almost a quarter of holiday spending.

Their mood is not rooted in financial fears. Rather, they think they "have enough stuff" after reordering their priorities during a three-year economic downturn.

"Expressions of happiness are being increasingly decoupled from the desire to acquire more and more things," said Jim Taylor, vice president of the Harrison Group, a market research firm hired by American Express. "The search for the holiday spirit resides in family and simplicity."

Frugal forecast for holiday gift spending and retail hiring 10/06/11 [Last modified: Thursday, October 6, 2011 1:16pm]

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