Maryland?s stable economy should produce better-than-average holiday retail sales, as national forecasts predict a down gift-buying season for retailers.
“We?re not going to experience a disaster year locally. The Maryland economy, with low unemployment and high incomes, is pretty strong,” said Richard P. Clinch, a University of Baltimore economist.
“All of the headlines about the economy are pretty bad, so nationally, you?ll probably see a decrease from last year,” Clinch said.
Several retail industry research firms have predicted national holiday sales will decrease from last year, saying the housing downturn and credit crunch will affect the consumer?s willingness to spend.
The National Retail Federation, based in D.C., predicts holiday sales will increase 4 percent this year to $474.5 billion. The increase is expected to fall below the 10-year average of 4.8 percent and would be the slowest sales growth since 2002, when sales rose 1.3 percent.
“Retailers are in for a somewhat challenging holiday season as consumers are faced with numerous economic obstacles,” NRF Chief Economist Rosalind Wells said in a statement. “With the weak housing market and current credit crunch, consumers will be forced to be more prudent with their holiday spending.”
New York-based Ernst & Young expects holiday sales will increase 4.5 percent, down from last year?s increase of 4.9 percent. The International Council of Shopping Centers, also of New York, said current economic conditions will result in a 2.5 percent sales increase.
Retailers are gearing up for the holiday shopping season, adding part-time sales employees to handle the inevitable buyer rush, said Christopher S. Schardt, senior general manager of Harborplace & The Gallery.
Companies and stores are also kicking off the holiday season earlier than usual, Schardt said.
“Because spending is expected to be a little less this year, I think retailers are pushing the envelope a little bit,” he said. “They?re getting their stores decorated earlier and increasing television advertisements.”
