Americans plan robust spending this holiday season, but worry about inflation, supply bottlenecks
Shoppers at the King of Prussia mall in King of Prussia, Pennsylvania, on Saturday, Dec. 4, 2021.
Hannah Beier | Bloomberg | Getty Images
Americans plan to spend with gusto this holiday season despite concerns about the economy and inflation and worries that supply bottlenecks might delay the arrival of their gifts.
The CNBC All-America Economic Survey finds that individuals, on average, plan to spend $1,004 on gifts, up 13% from the pandemic-depressed number last year, and the highest number since 2018. The survey of 800 adults across the country found 15% plan to spend more this year, up from 11% in 2020, and 35% plan to spend less, down from 39%.
“I think it will be a good Christmas,” said Jay Campbell, partner at Hart Research Associates, the Democratic pollsters for the survey. “People will be spending and consumers are willing, eager and mostly able to get out of their houses and back into stores to spend those dollars.”
Yet the survey clearly shows that the current issues of supply chain problems, inflation and overall negative views on the economy are creeping into consumers’ Christmas cheer. Among those who are spending more, a third say it’s because they have more money, a quarter say it’s because they have more people to buy gifts for and 16% cite higher prices.
Among those spending less, 25% say it’s because the economy is in bad shape, 21% cite higher prices or trouble paying bills and 17% want to save money. Meanwhile, 36% say they started shopping earlier than normal because they were afraid they might not get their gifts in time and 25% are concerned gifts might come late.
“I’d say the holiday spending numbers in this poll are relatively solid,” said Micah Roberts, partner at Public Opinion Strategies, the Republican pollsters for the survey. “But it doesn’t get rid of the cost of living stressors that Americans are under.”
Biggest worry now: Inflation
The survey found that inflation has catapulted ahead of Covid to become the top issue of concern in the country. Last quarter, the two issues were tied. Meanwhile, 41% of the public believe the economy will get worse in the next year, a modest improvement from last quarter, but still a largely pessimistic number and up 7 points from a year ago.
The survey found that half of Americans say they will do most or all of their shopping online, a decline of five points from 2020, but still five points above the pre-pandemic level. This could be initial evidence that some of the pandemic boost to online shopping may endure. Amazon continues to be the runaway online leader with 35% of the Americans saying it’s their No. 1 online destination. In second place came Etsy and other local business websites with just 7%, followed by Walmart’s website at just 5%.
One advantage brick-and-mortar stores might have this Christmas: People are less afraid to go out in public compared to last year. The survey, which was taken from Dec. 1 thru Dec 4 after news of the omicron variant became public, found a sharp drop in concern about going to malls, boarding planes and visiting big American cities. A year ago, 60% of the public said they were concerned about going to concerts or theme parks or sporting events. That percentage has now fallen to just 34%.
The least concern of all when it comes to Covid: visiting small businesses not in shopping malls.
While 23% say they are concerned about visiting shopping malls because of Covid, down from 36% a year ago, just 11% express any worry when it comes to small stores not in shopping malls, down from 17%.