Washington - Continued consumer uncertainty over job security and housing values will contribute to a 1 percent decline in total retail sales this holiday season, according to a forecast by the National Retail Federation (NRF).
The projected decline, to $437.6 billion, will anniversary last year's 3.4 percent drop in holiday revenue, the industry trade group said.
NRF's projection includes sales at discount, specialty, department and grocery stores in November and December, and excludes sales at car dealers, gas stations and restaurants.
The forecast falls significantly below the 10-year average of 3.4 percent holiday season growth, but will be less severe than the 3 percent decline in annual retail revenue expected for all of 2009.
"As the global economy continues to recover from the worst economic crisis most retailers have ever seen, Americans will focus primarily on practical gifts and shop on a budget this holiday season," said NRF chief economist Rosalind Wells.
The trade group also predicted price deflation in CE and other popular holiday categories due to aggressive sales as retailers become even more promotional.
"The expectation of another challenging holiday season does not come as news to retailers, who have been experiencing a pullback in consumer spending for over a year," noted NRF president/CEO Tracy Mullin. "To compensate, retailers' focus on the holiday season has been razor-sharp, with companies cutting back as much as possible on operating costs in order to pass along aggressive savings and promotions to customers."