Natl. Retail Fed: Holiday Sales Will Fall

The National Retail Federation has issued a prediction that may not come as a surprise to many struggling retailers and cash-strapped consumers: holiday retail industry sales will decline this year for a second year in a row. According to the NRF, consumer fears over job security and home values are the main forces that will drive down consumer spending this year.

The trade group’s forecast predicts that sales in the months of November and December will decline about 1 percent from 2008 to $437.6 billion, which would still be a significant improvement over last year’s decline of 3.4 percent. However, these two years of decline come after an uninterrupted streak of gains that began in 1995, with the average gain over the last ten years sitting at 3.4 percent.

Consumer confidence has remained remarkably difficult to predict ever since the onset of the economic crisis last fall, but most reports have consumer confidence dropping significantly over the past few months. The economy has most consumers worried about their short-term financial status and about the stability of their incomes.

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