NEW YORK—Thanksgiving has come and gone and there’s no denying it anymore: we are officially in the holiday season. Holiday shopping has already kicked off, and this year is shaping up to be one of the biggest yet, according to the National Retail Federation (NRF). In early November, the NRF reported that holiday spending was expected to reach record levels throughout November and December, growing between 3 percent and 4 percent over 2022. Spending is expected to reach between $957.3 billion and $966.6 billion.

This growth, the NRF reports, is “consistent with the average annual holiday increase of 3.6 percent from 2010 to 2019.” It is slower, though, than the past three years, as those years were affected positively by stimulus dollars. Still, even with inflation and an unpredictable economic landscape, we are all still shopping—and taking the holiday season to heart. The NRF reported that consumers who celebrate the winter holidays expect to spend an average of $875 on gifts, decorations, food and other items this year.

About $620 of those dollars will be spent on gifts. This is $42 more than they expected to spend last year, but overall in line with the average holiday budget of the last five years.

Although consumers are expecting to spend more this year, most are still making sure they get some serious bang for their buck. The NRF said that 62 percent of shoppers “say sales and promotions are even more important to them this year than last year. About one-third (36 percent) say they are cutting back in other areas to cover the cost of holiday items—30 percent are purchasing gifts for fewer people and another 27 percent are buying less for themselves.”

Most holiday shopping will take place online this year, though plenty of consumers are still heading into stores. Graph via National Retail Federation.

The biggest rise in shopping is, unsurprisingly, expected online. Online shopping has become a mainstay since 2020, reflecting one of the largest shifts in the way consumers shop. Online and “other non-store sales” are expected to increase between 7 percent and 9 percent this year, to a total of between $273.7 billion and $278.8 billion.

People are still heading into stores, though—and the stores are responding. According to the NRF, retailers will hire between 345,000 and 450,000 seasonal workers this year to meet demand, a figure that is in line with 391,000 seasonal hires in 2022.

And, of course, millions have already started—and maybe even finished—their holiday shopping. In 2019, the NRF found that 46 percent of consumers started their holiday shopping before November; in October of this year, 39 percent said they planned to start shopping earlier than usual. Starting earlier helps consumers spread out their expenses and find better deals.

For retailers, it’s clear: it’s never too early to start thinking about your holiday marketing, campaigns, promotions and events. But if you haven’t started yet, fear not: we still have four full weeks until Christmas Day, and the NRF said, “Regardless of how early consumers start, the majority (62 percent) expect they won’t finish until December.”

So, holiday shopping season is upon us in full force, and it’s shaping up to be a big one. As we, hopefully, spend this Thanksgiving weekend relaxing and sharing time with those we love, we can also recharge our batteries and head into the holiday season ready to give these next four weeks our all.

Holiday sales are expected to reach record levels this year. Graph via the National Retail Federation.