The holiday shopping season is estimated to be significantly costlier this year than last year.
The National Retail Federation says the typical American consumer will spend about $890 this holiday season on gifts, food, decorations, etc. But that might not be the end of it.
There’s a new study out from LendingTree that finds that because of President Trump’s import taxes, tariffs will cause about a $40 billion increase in holiday costs. Retailers will absorb some of that, but nearly three-quarters of it, roughly $29 billion, will be shouldered by consumers. That translates to an extra $132 per shopper.
Rising prices, trade wars, coupled with questions about food support and health care – those are not very conducive to holiday merriment.
Normally, I would say that this situation highlights what makes the holiday season so special: families, friends and a sense of gratitude. But economically speaking, this season is crucial for businesses to generate the revenue they need to cover their annual expenses, and it’s equally pivotal for the people they employ.
So obviously, if we’re not spending or are forced to pull back, that’s not good for the overall economy. Spending represents roughly two-thirds of U.S. economic activity, and if we’re slowing down, jobs are on the line.
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