According to recent data, holiday shopping is off to a slower start this year, indicating a return to normalcy in the economy. U.S. retail sales have fallen for the first time since March, marking a noticeable impact of the pandemic on the timing of holiday shopping. In previous years, holiday shopping would have started as early as September; however, this year it seems that consumers are waiting until later in the season to start their shopping sprees.
Senior Economist Robert Spendlove believes that this shift in the timing of holiday shopping is reflective of the economy still being affected by the pandemic. He draws a comparison between the pandemic and a rock being thrown into a lake- with the ripple effects of the impact still being felt. While we may be over with the pandemic, we are still dealing with its aftermath. Overall, improvements are being observed in employment data, inflation, and retail spending; however, it seems that we are yet to achieve a soft landing completely.
Despite months-early holiday shopping being more common during the height of the pandemic when last-minute shopping and picking up gifts were not an option, Spending believes that returning to a more traditional timeline this year is a good sign. With more normal holiday shopping trends in place and an expected cooling down of the economy soon, it’s predicted that spending will pick back up after Thanksgiving. A true sense of economic normalcy seems to be on the horizon as we continue to move past these challenging times.