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Analysts predict small rise in holiday shopping

Experts are using two very familiar words to describe forecasts for retail sales this holiday season: slow growth.

Economists tracking America’s modestly improving economy say a similar pattern will occur at Massachusetts stores and across the nation. Retail groups also see better but not spectacular gains this holiday season.

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The Retailers Association of Massachusetts expects holiday sales in the Commonwealth to total $15 billion in November and December, ticking up 3.5 percent from last year.

The national predictions vary slightly, from a gain of 3.9 percent to $602.1 billion in total sales — projected by the National Retail Federation — to a more modest 3.2 percent increase anticipated by the forecasting company IHS Global Insight.

“It’s a relatively OK sign and we’re above water,” said economist Chris Christopher, director of global and US consumer markets for IHS, which has offices in Lexington. “You don’t want to party and say the good times are back again, but things are picking up.”

The predictions represent stable retail sales after a five-year period marked by extreme lows and relatively big gains. Holiday sales in Massachusetts declined 7 percent in 2008 before jumping 7 percent off a very low bottom two years later.

People who walked past holiday lights in Boston last year will have one less holiday season weekend to shop in 2013.

Charles Krupa/Associated Press/File 2012

People who walked past holiday lights in Boston last year will have one less holiday season weekend to shop in 2013.

Christopher said the growth forecast for business this season is inflated because it will be compared to relatively weak sales last Christmas, which inched up by 2.8 percent in the state. Despite the anticipated sales bump, he said, the retail sector will still be stifled by the shorter holiday shopping season and strong sales in October.

There are six fewer days between Thanksgiving and Christmas and one less weekend for shoppers to fall victim to impulse buys, which account for a third of all department store purchases.

“Everyone is bending over backward to drive traffic now, which is good and helps to some extent,” said Jon Hurst, president of the Retailers Association of Massachusetts. “The fact is that most shoppers are procrastinators and when you have one less weekend, most people are going to shop less.”

October retail sales grew 0.4 percent nationwide. Christopher said the increase was driven by technology sales, particularly of the new iPhone 5S and 5C models, an extra benefit that retailers will not get in November and December.

The brightest spot in the holiday forecast is online purchases, which are expected to account for 14 percent of all holiday sales.

Shop.org, the digital arm of the National Retail Federation, predicts Internet sales will reach $82 billion, up as much as 15 percent from last year.

E-tailers are giving themselves a head start with early, Black Friday-like door-buster deals. They are promoting purchases on tablets and smartphones, offering even more items at a discount.

“The one sector that is growing is e-commerce,” Christopher said. “It’s playing a stronger role every year and cannibalizing on the brick-and-mortar sales.”

Holiday sales typically account for 20 to 40 percent of retail business. While Hurst said it is good that sales are increasing, further growth is held back by a 7.2 percent unemployment rate in a state with roughly 250,000 people out of work.

“It keeps a question mark in a lot of people’s minds,” he said.

Mass Insight, a Boston research company, recently released improving results in its quarterly consumer confidence index in Massachusetts. The overall score in October came in at 86, up from 80 in July, but still represented a negative view of the economy. The index uses a base score of 100 to represent an equal number of people with positive versus negative views of the economy.

Taryn Luna can be reached at taryn.luna@globe.com.
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