Consumer spending this holiday season got off to a rather slow start last month when fewer people hit up retailers over Black Friday weekend. And that trend of spending less likely won’t change in the final few weeks of 2014 if a new holiday spending survey is to be believed.
Bankrate.com released its holiday spending survey today, revealing that four out of five consumers (82%) say they won’t be spending any more in the final push to the holidays than they doled out last year.
Analysts at Bankrate say the large number of consumers planning to hold steady on their holiday spending comes as a surprise, considering gas prices have fallen nearly 15% this year.
Of the 16% of consumers who say they will spend more this holiday season, nearly 5% cite lower gasoline prices as the reason.
By breaking down the numbers and demographics of the 1,001-person survey, Bankrate found that falling fuel prices have a bigger influence on lower-income consumers’ spending habits.
According to the survey, Americans who earn an annual income between $30,000 and $49,900 were more likely than others to report that they will spend more this season because of lower gas prices. On the other hand, higher-income Americans (those earning $75,000 or more per year) were more likely to report that they are spending more for reasons other than saving money at the pump.
Still, Greg McBride, chief financial analyst for Bankrate, says that cheaper prices at the pump really isn’t enough to spark a shopping frenzy for most consumers.
“Consumers are still uneasy,” he says. “Many haven’t had a raise in quite some time. Their savings cushions are insufficient, and any breathing room from the drop in gasoline prices could prove temporary should those prices rebound.”
Analysts say that for the remaining 11% of consumers who plan to spend more this year, but didn’t cite lower gas prices as the reason, pent-up demand for goods may be their driving force.
“I think that people are probably anxious to begin spending again,” Gail Cunningham, a spokesperson for the National Foundation for Credit Counseling, tells Bankrate. “I’ve often called it the seven-year itch.”
As for who you can expect to see waiting in the checkout lane leading up to the big holidays, that would be millennials. Nearly 28% of consumers ages 18 to 29 say they plan to spend more this season.
So while some consumers plan to spend big this holiday season, those planning to hold back might have the right idea. After all, according to a report earlier this week most of the items people want for Christmas are actually cheaper after the holidays.
Holiday spending unfazed by cheaper gas [Bankrate.com]
by Ashlee Kieler via Consumerist
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