Holiday Spending Up According to Naitional Retail Federation: Rethinking Holiday Spending and Its Economic Impact (Small Business)

Holidays tend to drive increased consumer spending, which can have a significant impact on the economy. For many companies—especially small businesses—the holiday season can determine whether they finish the year in the black or the red, since they often operate on very thin profit margins.

I encourage people to buy as much as they reasonably can from small businesses that create and sell their own products. Supporting small businesses strengthens our communities and helps foster the next generation of entrepreneurs. Research consistently shows that innovation and small businesses are closely linked, making this support beneficial to society as a whole.

A healthy economy also depends on balance—between large, medium, and small businesses. When the economy becomes too top-heavy, the playing field is distorted and competition suffers. On the other hand, if businesses are too small, they may lack the efficiencies needed to compete globally. Balance allows the economy to move through normal boom-and-bust cycles that ultimately drive long-term growth.

This holiday season, as you consider your spending habits, it’s worth noting that much of the increase appears tied to things such as sporting goods, clothing, digital products, and groceries. From November 1 to December 31, consumer spending reportedly rose by about 3.7% to 4.2% compared to 2024, with total spending exceeding one trillion dollars. Trend charts and spending breakdowns help put this growth into perspective.

As for me, I plan to be more selective about what I buy this year—focusing on purchases that genuinely enhance life and enjoyment, rather than simply trying to keep up with the Joneses. My Christmas gifts were already bought. However, from a metric standpoint this is a positive sign. I'm curious how much is going on credit card and how much comes from savings?

National Retail Federation November