Despite fears over the COVID-19 Omicron variant, inflation and supply chain disruptions, shoppers were undeterred this holiday season, with sales up 8.5% this season. The main drivers were online shopping and the jewelry sector, which saw its largest year-over-year increase, according to Mastercard Spending Pulse, which measures in-store and online retail sales.
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Retail sales also increased by 10.7% compared to 2019. Online sales increased by 11% compared to the same period last year, while in-store sales increased by 8.1% compared to 2020 and 2.4% compared to 2019, according to preliminary information. to Mastercard.
The gain was a little lower than the 8.8% increase that Mastercard had predicted, but it was the largest annual increase in 17 years, CNBC reported.
“Shoppers were eager to secure their gifts ahead of the retail rush, with conversations about supply chain and labor issues sending consumers online and into stores in droves. “said Steve Sadove, Senior Advisor to Mastercard and former CEO and Chairman of Saks Incorporated. in a report. “Consumers splurged throughout the season, with clothing and department stores seeing strong growth as shoppers sought to show off their dressiest foot.”
With supply chain shortages on their minds, one of the key trends this holiday season is for consumers to buy early.
“My biggest concern heading into the holiday shopping season was supply chain issues,” Dustin Thackeray, chief investment officer at Crewe Advisors, told Bloomberg. “I was concerned that there weren’t enough products on the shelves to help with spending, but that seems grossly exaggerated and the US consumer is still strong despite Omicron.”
Additionally, retailers offered special promotions at the start of the season and then again later in the season as shoppers rushed to get “guaranteed Christmas” shipping deals, according to Mastercard.
One of the sectors that has seen the biggest increase in sales is the jewelry sector, which is seeing the strongest year-over-year growth, with sales up 32% compared to 2020 and 26.2% compared to 2019.
In terms of online shopping, the sector continues its upward trend since the start of the pandemic, accounting for 20.9% of total retail sales, compared to 20.6% in 2020 and 14.6% in 2019.
Another key finding is that Thanksgiving weekend remained key, with Black Friday once again marking the most spent day of the 2021 holiday season.
For Thanksgiving weekend, shoppers pushed U.S. retail sales up 14.1% year over year. In-store sales also increased, rising 16.5% year-over-year, while online sales saw solid growth, up 4.9% year-over-year . The main drivers of the weekend’s growth were clothing sales, with 51.2%, department store sales, with 19.0%, and jewelry sales, with 78.4%.
The National Retail Federation (NRF) expects 2021 holiday sales to increase by up to 11.5% from 2020, beating the NRF’s previous forecast of growth of between 8.5% and 10.%. Even at the lower end of the range, the amount spent and the rate of growth would set new records, the NRF said in a statement.
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“We expect demand to remain strong through December, even though consumers have started holiday shopping earlier than ever this year,” NRF President and CEO Matthew Shay said in the statement. “Despite the rise of the omicron variant, the increase in vaccination rates combined with retailers’ ongoing safety protocols and procedures has allowed consumers to feel they can continue to shop safely and conveniently. We believe holiday sales this year could be up to 11.5% higher than 2020.”
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This article originally appeared on GOBankingRates.com: Holiday Retail Sales Surge 8.5% Despite Omicron, Inflation and Supply Chain Disruptions