For the first time, holiday retail sales in the United States are expected to top $1 trillion, with consumers continuing to prioritize gifts and celebrations despite inflation, rising gasoline prices and an uneven economic outlook. The National Retail Federation (NRF) forecasts that November and December sales will reach $1.013 trillion, a 4.2% increase over 2025.
The projection marks an acceleration from last year, when holiday sales increased 3.1% to $972 billion. If the forecast holds, this year would deliver the strongest holiday sales growth since 2021, when sales surged 12.6%.
“This year’s forecast reflects our confidence that consumers will prioritize the holiday season even as they remain mindful of their budgets,” NRF President and CEO Matthew Shay said.
Speaking during an October 15 media call, Shay emphasized that Americans have consistently made holiday spending on loved ones a priority.
“They’ve repeatedly shown that the holidays and spending on loved ones are priorities,” he said.
Still, the record-breaking forecast comes with an important caveat: Not all households are experiencing the economy in the same way. NRF leaders described a K-shaped spending pattern, in which higher-income consumers continue to drive a disproportionate share of retail growth, while households with tighter budgets remain more cautious.
NRF Chief Economist and Executive Director of Research Mark Mathews said rising financial wealth is supporting spending among affluent households, while higher gas and food prices are putting greater pressure on moderate- and lower-income consumers. In some retail sectors, Mathews noted during the call, the top 10% of spenders account for as much as 70% of sales.
The forecast offers reason for optimism, particularly among shoppers with room in their budgets for meaningful gifts. Consumers are expected to remain deliberate and value-conscious, making attractive designs, compelling price points and thoughtful gift options important throughout the season.
US retailers are preparing for the demand by planning to hire between 325,000 and 375,000 seasonal workers, roughly in line with last year’s estimated 356,000 hires.
NRF also expects artificial intelligence to play a larger role in holiday shopping, as consumers increasingly use AI tools to research products and compare options.
The NRF defines the holiday season as November 1 through December 31 and excludes automobile dealers, gasoline stations and restaurants from its retail-sales calculation. Holiday sales have accounted for approximately 19% of annual retail sales over the past five years.
Credit: Image by The Jeweler Blog using aichatapp.ai.