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Gallup Holiday Spending Survey: A Real Look

  • Written by Syndicated Publisher No Comments Comments
    November 18, 2013

    Last week Gallup released its latest survey on holiday spending plans. The title of the article nicely summarizes their findings: Americans Trimming Their Holiday Spending Plans.

    The survey question was “Roughly how much money do you think you personally will spend on Christmas gifts this year?”

    The Gallup chart accompanying the piece shows the spending estimates for the same week all the way back to 1999. Of course, over the 15-year time frame, the value of the dollar has shrunk considerably. If you adjust for inflation using the Consumer Price Index, that November 1999 dollar is worth about 72 cents today.

    So let’s compare the Gallup nominal dollar spending plans with their “real” values, chained in November 1999 dollars based on the Consumer Price Index.

     

     

    The adjacent table showing the overall percent change helps us understand the trend in real spending plans of the participants over the history of this series. Today’s holiday spenders obviously do not envision partying like it’s 1999 (to borrow a Prince lyric). The latest spending plans are about 41% below the average amount reported in the equivalent 1999 survey. In fact, the table gives us crude but convincing snapshot of the trend in consumer sentiment since the turn of the century. The contour of the inflation-adjusted series in the chart above corresponds closely with the broader snapshots of consumer sentiment:

     

    Based on the latest data, Gallup forecasts that “…according to Gallup modeling of the trends, consumers’ new scaled-back plans for 2013 suggest overall holiday spending — defined by the National Retail Federation as holiday shopping that occurs in November and December — now may be relatively anemic, increasing by only 1.7% to 2.4% over 2012.”

     

     

     

    Images: Flickr (licence attribution)

    About The Author

    My original dshort.com website was launched in February 2005 using a domain name based on my real name, Doug Short. I’m a formerly retired first wave boomer with a Ph.D. in English from Duke. Now my website has been acquired byAdvisor Perspectives, where I have been appointed the Vice President of Research.

    My first career was a faculty position at North Carolina State University, where I achieved the rank of Full Professor in 1983. During the early ’80s I got hooked on academic uses of microcomputers for research and instruction. In 1983, I co-directed the Sixth International Conference on Computers and the Humanities. An IBM executive who attended the conference made me a job offer I couldn’t refuse.

    Thus began my new career as a Higher Education Consultant for IBM — an ambassador for Information Technology to major universities around the country. After 12 years with Big Blue, I grew tired of the constant travel and left for a series of IT management positions in the Research Triangle area of North Carolina. I concluded my IT career managing the group responsible for email and research databases at GlaxoSmithKline until my retirement in 2006.

    Contrary to what many visitors assume based on my last name, I’m not a bearish short seller. It’s true that some of my content has been a bit pessimistic in recent years. But I believe this is a result of economic realities and not a personal bias. For the record, my efforts to educate others about bear markets date from November 2007, as this Motley Fool article attests.
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