Amanda Logan on Holiday Spending

How does holiday spending look this year?

In short, holiday spending isn't looking too cheery this year. Although Black Friday weekend sales were slightly up compared to last year, it was a much smaller increase than we saw the previous year. And, importantly, retail sales for November were the lowest that they've been in 30 years, and this is the second month of decline in retail sales. Another important thing to note here is it's not just middle-income families or low-income families who are cutting spending. We're seeing retail sales declining at even the high-end stores, and in order to get merchanidise off the shelves and into customers shopping carts, retailers are having to offer really deep discounts—sometimes up to 70 percent. Also tellingly, stores are starting to reintroduce layaway programs—something that many have not had for 20 years around. So it look like they're preparing for consumers to really tighten their wallets this holiday season.

What effect will decreased holiday spending have on the economy?

Lower holiday spending is not likely to do much to help the economy. We've already seen record low levels of consumer confidencce and we've experienced 11 straight months of decline in employment levels. In fact, in November, a month when retailers normally hire more people to help move their holiday goods off of the shelves, we saw a decline of 90,000 jobs in the retail sector. And this is only likely to continue if we see lower retail sales this holiday season. And that will have a rippling effect throughout the economy—or will likely have a rippling effect throughout the economy—as people buying less things means we need less people to make said things, and in short, do more to further lower consumers' not-so-cheery outlook on the economy.

How can we reinvigorate consumer spending?

In order to see an increase in consumer spending, we're going to have to see an increase in consumer confidence. And that means families are going to need to begin to feel more confident about their situation. Right now they're worried about losing their job and being able to pay their basic bills for their necessities such as their home or their health care expenses. We've lost nearly 1.2 million jobs this year, and many families haven't really felt an increase in their income in several years. So, in short, we need to get good jobs with good benefits and good wages back into the economy and make sure that these jobs are going to be around for several years. Some examples of ideas on how to start going on this would be to pass a second stimulus package to really focus on the creation of good jobs that will be around in the long term and provide families with good benefits and good wages. We also need to really think smartly about our recovery program and what type of recovery we'd like to have. We've had a lot of positive ideas come about—a green recovery—which would help with the creation of good, good paying jobs for families. And finally, we need to really consider our long-term growth and make sure that growth is something that will be felt and shared accross al levels of incomes of Americans and not just those at the top.