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Consumer Spending Begins to Wobble

Written By Brian Hicks

Posted December 17, 2007

With only seven more shopping days until Christmas, the most watched season of consumer spending of all time appears to be on the verge of being something of a disappointment as another lack luster weekend has made for frayed nerves within the retail industry. 

Here’s a sampling of what’s going on out there in malls across America. 

From the Associated Press entitled: Unimpressive weekend has retailers nervous.

"Following a lukewarm shopping weekend, the nation’s stores are now focusing their attention on the final week leading to Christmas, as consumers seem to be postponing more of their buying to the last minute compared to a year ago.

"This holiday season at this point has been disappointing, whether they’re brick and mortar, catalog or online," said C. Britt Beemer, chairman of America’s Research Group, based in Charleston, S.C. "Shopper are more frugal and cost-conscious because they have less money to spend." As for Saturday and Sunday, he said, "This weekend was busy, but it wasn’t huge."         

Store executives say consumers are even more savvy about buying this season, doing a lot of their homework before they grab deals. This year, the economy, particularly the housing crisis, has hurt shoppers’ spending.

"I got laid off from my job in the mortgage industry," said Janina Kosloski of Orange County, Calif., who was visiting relatives in Minnesota. "Right now, I’m basically scared of losing my house."


Meanwhile, the greatest shopper the world has ever known-the American woman-appears to be cutting back on purchases for themselves.

From the New York Times by Michael Barbaro entitled: Retailers Face an Ominous Holiday Sign


"Sales of women’s clothing, a traditional pillar of the holiday shopping season, are unusually bleak so far this year, according to a major credit card company, an ominous sign for the retail industry.

From high-end dresses to bargain coats, spending on women’s apparel dropped nearly 6 percent during the first half of the Christmas season, compared with the same period last year, according to MasterCard Advisors, a division of the credit card company.

Analysts blamed a rough economy, which has discouraged women – and mothers, in particular – from splurging on clothing for themselves and a lack of compelling fashions this winter."


And this article from CNN Money by Suzanne Kapner entitled: Stores hiring fewer holiday temps.


"Like the holiday fruitcake and mistletoe, another staple of the Christmas season is the temporary retail job.

But less so this year. Faced with one of the toughest holiday shopping seasons in recent years, retailers are keeping a tight lid on hiring. Some 509,000 retail jobs were created in the October-November period, a 9 percent decrease over the same period last year, according to Challenger, Gray & Christmas, a Chicago-based staffing firm.

Unless there is a big upswing in December, the number of temporary jobs created by retailers this year is expected to shrink for the first time since 2001. "Retailers are being very cautious about staffing," said John Challenger, the firm’s chief executive.

The last big drop in seasonal retail hiring occurred in the months following the Sept. 11 terrorist attacks, when temporary sales help shrunk by 26 percent to 585,000 workers, the lowest level in a decade, according to Challenger, Gray & Christmas, which parses data from the Bureau of Labor Statistics. Seasonal hiring has grown every year since 2003, amid stronger-than-average holiday sales gains.

This year, however, the National Retail Federation expects holiday sales to grow 4 percent to $474.5 billion, the slowest pace since 2002."