Dive Brief:
- The National Retail Federation expects retail sales during the holiday season to grow 4.2% year over year to roughly $1 trillion, according to a Thursday announcement. The trade group anticipates nearly half of the nominal sales growth will result from real consumer spending growth, NRF Chief Economist and Executive Director of Research Mark Mathews said on a media call.
- Last year's holiday sales missed NRF's expectations. Seasonal retail sales in 2025 grew 3.1% year over year to $972 billion, below the trade group's prediction of 3.7% to 4.2% growth.
- In line with the slower labor market, retailers are expected to hire between 325,000 and 375,000 seasonal workers, the trade group projected. NRF defines the holiday season as Nov. 1 through Dec. 31.
Dive Insight:
Consumers have remained resilient in their shopping habits this year despite macroeconomic headwinds, NRF President and CEO Matthew Shay said on Thursday’s call.
However, Mathews acknowledged that inflation undoubtedly contributes to nominal sales growth, with higher diesel prices and increased memory prices pressuring popular gifting categories such as electronics.
“As we head into the holiday period, if gas prices remain higher, we do expect that this will have a larger impact on households at the lower end of the income spectrum,” the chief economist said on the call. “Despite inflationary pressure, we expect goods prices to run lower than headline inflation as retailers respond to a price-conscious consumer.”
NRF’s forecast is based on economic modeling using indicators such as consumer spending, disposable personal income, employment, wages, inflation and previous monthly retail sales. The calculation excludes gas stations, automobile dealers and restaurants.
The potential muted holiday hiring is reflective of how retailers and other industries are navigating a “low hire, low fire environment,” per Mathews.
In 2025, the trade group predicted retailers would hire between 265,000 and 365,000 seasonal workers, in line with a similarly slow labor market. That was a drop from the 442,000 seasonal retail employees hired in 2024.
