Survey reveals which categories will see holiday increases — and decreases

Amid economic uncertainty and high inflation, Americans appear to be approaching the holiday season somewhat cautiously and shifting their spending.

U.S. consumers intend to spend an average of $613 on holiday gifts this year, down from $648 last year, according to The Conference Board’s Holiday Spending Survey.  

By contrast, consumers expect to spend more on related non-gifts items—$393 this year compared to $374 last year. (Non-gifts include food, decorations and wrapping paper.) The increase reflects high inflation and surging food prices in particular, the Conference Board said.

Gift cards are set to see the biggest spending increase, the survey found, followed by toys and games, vacation and travel. Home décor, furniture, appliances are forecast to see the largest decline, followed by jewelry and accessories, and tools and hardware.

The survey also revealed that consumers have returned to pre-pandemic norms in how they plan to spend their holidays and where they plan to make their purchases. Just 39% of consumers intend to make at least half of their gift purchases online this year—down from 52% in 2020, and the first back-to-back annual decline recorded.

Also, 30% plan on traveling away from home this holiday season, about the same last year. Of those, 47% intend to drive, with slightly less—43%—choosing to fly.

The changes in holiday spending likely reflect the uncertain economic outlook, rising prices—in particular food and gas—and consumers' shift away from durables to services as pandemic behaviors abate. 

The Conference Board’s Consumer Confidence Index decreased in October, after back-back-back monthly gains, as economic uncertainty and inflation continue to afflict consumers.

“Consumers appear to be rebalancing their budgets and priorities by reducing their gift-giving circles to help offset the higher costs of non-gift items, in particular food,” said Lynn Franco, senior director of economic indicators at The Conference Board. “Given this challenging landscape, retailers have already begun countering by offering shoppers earlier than usual discounts, sales, and incentives."