Flat Shopping Season Seen

Most Americans are planning to curb their holiday spending this year, making it a challenging shopping season for U.S. retailers, according to a holiday buying survey by NPD Group.

Nine out of 10 consumers said they would spend the same amount as or less than they did in 2003. Americans plan to spend an average of $655 this holiday season, the survey showed Tuesday.

A sluggish economy and nagging labor market weakness are making consumers keep a tighter hold on their wallets, Marshal Cohen, chief industry analyst for NPD Group, said.

Higher gasoline prices are another big factor, Cohen said.

“I’m heading into the holiday season with 500 fewer dollars in my pocket. Now, am I feeling warm and fuzzy about spending?” Cohen said. “No.”

In addition, “must-have” items, which have grown to include electronics such as DVD players and iPods, are increasingly expensive and take a proportionally bigger bite out of budgets that are static or even shrinking, Cohen said.

Young adults may be the ones driving sales during the holiday season, the most important time of the year for retailers, NPD Group said.

Consumers aged 18 to 24 plan to boost their holiday spending on average to $537 this year from $366 last year. Those aged 25 to 34 said they would cut their spending 21% over last year.

Seventy-two percent of consumers will shop this holiday season in discount stores including Target Corp. and Wal-Mart Stores Inc.

More than half of Americans plan to comparison-shop before buying, and a third of them will wait for sales to begin. Only about 27% of consumers had already started shopping, compared with the 31% who reported starting their holiday buying this early in 2003.