Survey: Floridians plan to reduce holiday spending

Nov 19, 2008 2 min read

GAINESVILLE, Fla. (AP) _ ‘Twas the month before Christmas and all through the mall, not many Floridians were shopping, their wallets were small.

Tough economic times are forcing Florida consumers to drastically cut back on plans for holiday spending, according to surveys conducted in September and October by the University of Florida Bureau of Economic and Business Research. More than 500 consumers participated each month in the telephone survey. The polls have a margin of error of 3 percent.

“The 2008 holiday season will be one of the worst for retailers in decades. In sharp contrast to previous years, decreased spending intentions were reported across all income brackets,” said Barton Weitz, executive director of the David F. Miller Center for Retailing Education and Research at UF.

Consumer plans for spending fell as the holiday shopping season grew closer. The September survey showed a 38 percent decrease from last year, from $1,328 per resident to $824. The average dropped again in October to $802.

The bad news extended to shopping malls, which can expect a 15 percent drop in the number of consumers planning to shop there, compared with 2007. Online shopping is expected to drop by 1 percent.

Gift cards, however, continue to appeal to consumers, with more than 60 percent indicating they will spend the same or more for them than in 2007, the surveys showed. Consumers, however, are staying away from buying gift cards from retailers having financial difficulties, Weitz said.

Department and specialty stores will be vulnerable to downturns in sales, but discounters such as Wal-Mart and Target may have opportunities to lure middle and high-income shoppers into their stores, Weitz said.

Stores selling luxury items will suffer, Weitz said, adding that for the first time since 2003, high-income households, defined as those making more than $100,000 a year, expect to decrease spending. He said data only exists for the last five years.

“A lot of these people had speculative investments,” Weitz said.

Last year, high-income consumers had planned to spend $2,490, compared with plans this year for $1,624.

Retailers may be able to survive the disappointing holiday season by maintaining slim inventories and holding down operating costs.

But Weitz was not all gloom and doom.

“Next year, the holiday period will be better,” he said.