Consumers say they plan to spend slightly less this holiday season, but in the midst of mortgage and credit troubles, they are less concerned this year about meeting all of their monthly payments, including credit cards and mortgage bills.
“I’m a little surprised the results weren’t weaker than they were,” said Credit Union National Association Chief Economist Bill Hampel, who released the survey on Monday with the Consumer Federation of America.
Only 40 percent are “very concerned” or “somewhat concerned” about their monthly payments, down from 43 percent in 2006. About 46 percent are “somewhat unconcerned” or “very unconcerned,” up from 44 percent the previous year.
About 35 percent of those surveyed also said they would spend “somewhat less” or “much less” than last year, up from 32 percent last year. The same percentage in 2006 and 2007 of those surveyed — 15 percent — said they would spend more than the previous year, while 47 percent said they would spend about the same this year and 52 percent the year before.
Opinion Research Corp. conducted the survey from Nov. 8-11 among 1,004 respondents, with a margin of error at plus or minus three percentage points.
When broken down by income, those in lower-income brackets were more concerned with paying loans and debts, and they were more likely to reduce spending.
Middle-income holiday shoppers will spend about the same amount, according to another report, which polled those with incomes of about $50,000. Roughly 36 percent said they would be less likely to make a major purchase, but 50 percent said their spending would stay the same from last season, and 14 percent will spend more. This survey was conducted for the Boston Consulting Group by Harris Interactive in October among 2,570 adults, the majority of which had annual household incomes above $50,000. No error rate information for the study was available.
Workers will see a 4 percent increase in their income this year, a real increase when compared with inflation increases of 2 to 2.5 percent, said Craig Rowley, vice president at management consultant firm the Hay Group.
Even so, Hampel predicts overall holiday sales will increase by about 4 percent this year, a forecast similar to other national predictions.
“Results are noticeably but not dramatically softer than last year. This suggests the bottom will not fall out … but it will be a tough year for retailers.”
