Retailers should expect another holiday shopping season with solid consumer spending, even as inflation, higher gas prices and household debt continue to put pressure on shoppers’ budgets, according to a recent forecast from the National Retail Federation.
The National Retail Federation (NRF) is forecasting that retail sales during November and December will increase 4.2% when compared to 2025, reaching a record $1.013 trillion. That would mark an improvement over last year’s holiday shopping season, when sales climbed 3.1% from 2024 to reach $972 billion.
The forecast suggests that consumers remain willing to spend during the year’s most important shopping period, though many will continue to look for bargains and weigh their purchases carefully.
“This year’s forecast reflects our confidence that consumers will prioritize the holiday season even as they remain mindful of their budgets,” said NRF President and CEO Matthew Shay, in a written statement. “Retailers are prepared to meet that demand with competitive prices, value and choices for every budget.”
Consumers have provided a bright spot for the broader economy, maintaining spending momentum despite several financial pressures, said Mark Mathews, NRF’s chief economist and executive director of research.
Still, he cautioned that the effects of inflation, rising gasoline prices and tighter household budgets won’t be felt equally across income groups.
“We head into the holiday season with strong spending momentum, as consumers remain the bright spot in the economy,” Mathews said. “At the same time, inflation, rising gas prices and pressure on household spending will affect consumers differently across income groups.”
That combination of resilient consumer demand and financial uncertainty is also influencing retailers’ seasonal staffing plans.
The NRF expects retailers to hire between 325,000 and 375,000 seasonal workers this holiday season. That range is largely in line with last year’s estimated 356,000 seasonal hires, suggesting that retailers are preparing for another busy shopping period without making an aggressive push to expand their temporary workforces.
The measured hiring approach reflects retailers’ continued caution about the economic environment. Higher gasoline prices, persistent inflation, elevated interest rates and growing consumer debt are all factors weighing on retailers’ decisions as they prepare for the final two months of the year.
For the retail real estate industry, the forecast offers an encouraging sign heading into the holiday season. The projected increase in spending suggests that consumers will continue to support retailers during one of the most important periods for store sales, even as shoppers become more selective about where and how they spend their money.
The NRF’s forecast also points to a holiday season in which value will remain a major selling point. Retailers will need to balance consumer demand with affordability, using competitive pricing and promotions to attract shoppers who are increasingly conscious of their household budgets.
