Consumers look to curtail travel and spending this holiday season.
How will the economy impact holiday travel this year? According to a survey conducted by Millionaire Corner in September, “I’ll be home for Christmas,” may take on a new meaning as more people decide to stay where they are.
Only about 20 percent said that they would be traveling more this year over the holidays than they did last year, while almost half (46 percent) said they would keeping close to home and hearth. Just over a third apparently doesn’t like to make plans that far ahead and said they didn’t have an opinion either way.
But the troubled economy can’t keep younger people tied down. The highest percentage of those who said they will be traveling more this year than last (36 percent) are under the age of 40, who may have less financial obligations than their older counterparts
This age group also looks to spend more money on the holidays than they did last year. They are the exception. It doesn’t look like the money saved on travel expenses is going to go for more presents. Only about 12 percent overall said they would buying more gifts this year. Of these, 40 percent are under 40.
Interestingly, the next group most likely to be traveling and spending more this holiday season is those with a net worth under $100,000. Almost 30 percent said they will be traveling more compared with the 17.5 percent of those with a net worth between $500,000 and $1 million.
It’s early for holiday travel forecasts, but there have been several surveys that offer conflicting forecasts for holiday shopping. One survey from Hay Group found that 68 percent of retailers expect holiday sales to increase this year. Unfortunately, this may not translate to seasonal hiring, which is expected to be at the same level as 2010.
The International Council of Shopping Centers, a major retail trade group, estimates holiday sales will rise 3.5 percent for November and December combined. This is less than last year, when sales during the same period rose 4.4 percent, a five-year high.
The Hay Group survey found that more than three-quarters of retailers (78 percent) expect to keep discounts in line with last year, but more retailers are getting an earlier jump on Christmas promotions. Thirteen percent are getting the (snow)ball rolling this month.
A robust holiday shopping season would be the greatest gift of all for the sluggish economy. Consumer spending accounts for about 70 percent of the nation’s economic activity, and traditionally the winter holidays are the year’s biggest shopping season with sales expected in the $450 billion range, according to POPAI, the global association for marketing at retail. In contrast, consumers spend $5.8 billion for Halloween.