After a year that included bankruptcies and negative reports about the future of shopping malls, retailers are ending the year with a high and prospects look up for 2018.
Retail sales increased by 4.9% during the holiday season compared to the same period last year, making this year the biggest year over year increase since 2011. Sales for this period were tracked by SpendingPulse Report from MasterCard, which tracked sales across all types of payment from November 1 to December 24.
The report says the sales increase is a new record for the number of dollars spent, but no figure was released. Another firm that researches retail sales, Customer Growth Partners, announced that from the beginning of the holiday shopping season through Christmas Eve, shoppers spent over $598 billion, which was up from the same period one year ago of $565 billion.
Counting the “second season” for retail which is the week between Christmas and New Year’s, sales overall for the complete holiday season are expected to surpass $671 billion, said the research firm.
Shoppers across the U.S. were spending large sums of money prior to the tax bill by the Republicans that promised tax cuts was passed, said reports that analyzed holiday spending habits.
Economists say that healthy sales in retail are supported by strong employment figures nationwide. The unemployment rate was just 4.1% during November which was the lowest rate since December of 2000.
However, some indications so that American might be stretching finances for their shopping splurge during the holiday. Personal spending increased 0.6% during November, but savings rates fell from 3.2% to 2.9% during October.
An economist on Wall Street says that is appears consumers went to their banks and took out savings to fund the holiday spending this year, betting that tax cuts would refill the coffers in the early part of 2018.
Most of the savings used during this season were spent online, with retail sales online up over 18.1% in comparison to last year. Cyber Monday this year was the largest sales day online in history, with retail data collector Adobe reporting that over $6.59 billion was spent in sales in one day, an increase of more than 16.8% from 2016.
From November 1 to November 27, shoppers in the U.S. spent over $50 million online and it was predicted that shopping online would surpass $100 billion before Christmas.
Sales of home appliances and electronics were up over 7.5%, home furnishings were up by 5.1%, and sales of jewelry jumped 5.9%.
Across all categories, whether it was big box, specialty department stores, or discount stores, everyone did better or less worse at least.