Retail Holiday Spending Forecast to Hit $1 Trillion

Retail sales in November and December are expected to grow between 3.7% and 4.2% from last year, according to the National Retail Federation’s (NRF) recently released annual holiday forecast. This translates to total spending between $1.01 trillion and $1.02 trillion.

“American consumers may be cautious in sentiment, yet remain fundamentally strong and continue to drive U.S. economic activity,” says NRF president and CEO Matthew Shay said. “We remain bullish about the holiday shopping season and expect that consumers will continue to seek savings in nonessential categories to be able to spend on gifts for loved ones.”

To meet consumer demand, retailers are hiring additional support this holiday season. NRF predicts retailers to hire 265,000 to 365,000 seasonal workers, down from 442,000 hired in 2024.

“The consumer is still driving economic activity, accounting for about 68 percent of GDP,” says Jack Kleinhenz, NRF senior economic advisor. “We believe that momentum will carry us through the final months of the year, though likely at a slower pace. There’s no indication from the data that the economy is deteriorating.”

Due to ongoing tariff uncertainty, retailers will be closely monitoring holiday spending patterns and waiting to hire additional staff based on demand. NRF chief economist Mark Matthews says consumers remained concerned about inflation, and sentiment is at levels the federation hasn’t seen since the 1980s.

Matthews says while consumers may be sentimentally weak, they’re fundamentally sound, and tend to look for value when making purchases, like shopping around holidays to grab extra deals.

“The economy has continued to show surprising resilience in a year marked by trade uncertainty and persistent inflation,” says NRF chief economist and executive director of research Mark Matthews. “As tariffs have induced an uptick in consumer prices, retailers have tried to hold the line on prices given the uncertainty about trade policies.”

The federal government shutdown will also affect consumer demand with a loss of private-sector income. NRF also found consumers plan to spend $890.49 per person on average this year on holiday gifts, food, decorations and other seasonal items, the highest amount in 23 years.