Economically Speaking: Missouri looking for merry holiday shopping season

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Joseph L. Driskill is the director of the Missouri Department of Economic Development.|ret||ret||tab|

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Thanksgiving has past, and with it came the "official" start of the holiday shopping season. The holiday retail season is always closely scrutinized because it gives us an idea of how consumers feel about the economy. If buyers are spending more, this boosts our economy and demonstrates an increased consumer confidence, which bodes well for the future. |ret||ret||tab|

Consumer spending accounts for about two-thirds of the national economy. Of course, a good holiday sales season also gives retailers a big lift at the end of the year. This is important because many retailers experience between 25 percent and 40 percent of their total sales during the holiday season, according to the National Retail Federation, the world's largest retail trade association. |ret||ret||tab|

Each year, the NRF surveys consumers nationwide to determine what they intend to spend during the holiday season. Based on their findings, the NRF forecasts 2003 retail sales may increase by 5.7 percent, which would be the largest increase since 1999. The NRF defines holiday retail sales as those taking place at stores that sell general merchandise, clothing and accessories, furniture and home furnishings, electronics and appliances, sporting goods, hobby items, books and music. |ret||ret||tab|

Though consumers say they plan to spend more this holiday season, the survey found that most consumers continue to base their decision as to where to shop on sales or discounts. The survey predicts that discount stores will see the most traffic with three-fourths of consumers (75.1 percent) planning to shop at a discounter this holiday. Consumers may also be heading to department stores (53.1 percent), specialty stores like clothing or electronics stores (36.7 percent), grocery stores (44.4 percent) and online (36.0 percent). |ret||ret||tab|

Interestingly, even though the holiday shopping season is defined as November and December, an increasing number of consumers are starting their holiday shopping earlier. This year, the NRF survey found that 43 percent of consumers planned to begin their holiday shopping in October or before, up from 39 percent last year. Another 35 percent of consumers planned to begin shopping in November with the remaining 22 percent planning to wait until December. |ret||ret||tab|

We certainly hope the NRF's predictions come true in Missouri. Our state tends to mirror the national economy on some levels, so we will be watching this holiday season with great interest. A recent report shows consumer confidence increased in October, an additional sign that a strong retail season may be upon us. |ret||ret||tab|

In October, the consumer confidence index was 81.1, up 4.1 points from September's score of 77. The numbers are on a scale of 100, and reflect how consumers perceive the current state of the economy and how they perceive the future. Confidence increased in both of these categories. Consumer confidence has been stagnant for the past six months, as consumers wait for the economy to improve. High debt burdens and joblessness may weaken consumer confidence, as well as expected increased energy prices for the coming winter months. Those with stable jobs have a little brighter outlook, with home equity refinancing options and steady income helping them to feel more confident about spending money. |ret||ret||tab|

We will be closely monitoring the trends, hoping for a strong holiday retail season. However, we won't have the complete results and statistics until early in 2004. We are hopeful that the forecasters are accurate, and 2003 holiday sales will outpace last year. |ret||ret||tab|

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