Analysts: It Could Be a Banner Year for Holiday Spending, Employment

With the holiday spending season in full swing, market analysts say this could be a banner year for sales, employment and holiday parties.

Seasonal hiring is quickly approaching a record set 12 years ago, a consultancy firm recently said. About 619,700 holiday workers were hired nationwide in October and November – a full 19 percent more than the 512,600 workers hired during the same time last year.

If another 140,300 workers are hired in December, that will match the nearly 760,000 people hired in 2000. Analysts said that goal isn’t farfetched. In years past, retailers have done a lion’s share of holiday hiring in December. With Walmart and other major chains opening on Thanksgiving Day and Macy’s staying open for 48 hours straight beginning on Dec. 21, there’s an influx of workers needed to fill the expanded hours.

“Despite all of the uncertainty, all the talk of fiscal cliffs, the widespread damage to retail epicenters on the east coast by Hurricane Sandy, and the continued growth of e-commerce, retailers are hiring holiday workers in record numbers,” said John A. Challenger, chief executive of the outplacement firm Challenger, Gray & Christmas Inc.

Holiday Spending Soars

At the same time, a new study showed that holiday spending this year would reach pre-recession levels. The average shopper will likely spend $854 on presents – a jump from the 2007 high of $859. Even though shoppers are spending more, they are being more conscious about credit card use, retail analysts said. About 80 percent of shoppers said they would try to keep credit card spending at bay – only using about 25 percent of their credit limit. In the pre-recession years, the number was much higher.

Overall, online holiday spending alone has reached $27 billion from Black Friday to mid-December. That’s up 13 percent from last year. Total holiday sales are forecasted to reach $586 billion, which is a 4.1 percent increase over last year.

Busiest Shipping Day in FedEx History

With all of this spending, there’s no doubt there’s a trickle-down effect. Monday was expected to be the busiest shipping day in the history of FedEx. One of the biggest reasons for the boost is the uptick in online shopping. The company normally ships about 8,000 packages a day. During the holidays, it jumps to about 15,000 packages a day. On Monday, FedEx expected to ship 19 million packages.

And if those aren’t enough signs that the economy is picking up, there are other indicators that have been putting more holiday cheer into the season. Businesses nationwide have been showing their confidence by loosening the purse strings and holding holiday parties. When the recession hit in 2008, a large number of companies put the brakes on holiday parties in an attempt to save money. This year, more than 83 percent of companies nationwide plan to host holiday parties. That’s up from 68 percent in 2011.

Bill “No Pay” Fay has lived a meager financial existence his entire life. He started writing/bragging about it seven years ago, helping birth Debt.org into existence as the site’s original “Frugal Man.” Prior to that, he spent more than 30 years covering college and professional sports, which are the fantasy worlds of finance. His work has been published by the Associated Press, New York Times, Washington Post, Chicago Tribune, Sports Illustrated and Sporting News, among others. His interest in sports has waned some, but his interest in never reaching for his wallet is as passionate as ever. Bill can be reached at bfay@debt.org.

Holiday hiring and spending increase

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    Sources:

    1. Diduch, M. (2012, December 11). The return of the office holiday party? NorthJersey.Com. Retrieved from http://www.northjersey.com/news/182931081_Companies_bringing_back_holiday_cheer.html?page=all
    2. Fairchild, C. (2012, December 5). Holiday Spending Projected To Return To Pre-Recession Levels: Study. The Huffington Post. Retrieved from http://www.huffingtonpost.com/2012/12/05/holiday-spending-recession_n_2245019.html
    3. Scherder, J. (2012, December 10). FedEx expects record shipping numbers as online sales soar. Ky3.com.