Area shoppers are expected to spend record amounts of money during the holiday season and statewide spending is expected to surpass $25 billion for only the second time.
More than $1.7 billion will likely be spent in the region, a 0.7% increase over last year, according to a study from the University of Cincinnati Economics Center and Ohio Council of Retail Merchants.
“The economy’s in a good place right now and consumers are comfortable with making more purchases,” said Chris Kershner, executive vice president of the Dayton Area Chamber of Commerce.
Ohio shoppers are expected to spend $25.3 billion, a 0.8% increase compared to 2018, the study shows. That’s a 6.8% jump from 2016 and 5.7% increase from 2017.
In general, Ohio has added jobs, raised wages and seen stable household debt ratios; consumer confidence and inflation has also remained stable, said Megan Heare, a research associate with the University of Cincinnati’s Economics Center. As households have felt more secure, retail sales have increased throughout the year.
“(President Donald Trump) is making things a little bit easier for the consumer,” said Dayton-area shopper Sandra Berger, who was looking for holiday decor Wednesday. “I do think that spending will be a little bit higher.”
But while stable, consumer confidence has dropped over the last year with uncertainty surrounding impeachment and tariffs, Heare said. Interest rate cuts this year are also likely to boost inflation and wages aren’t growing as quickly as other parts of the country, she said.
GDP growth in Ohio this year was lower than across the country and Ohio’s biggest cities — Cincinnati, Columbus and Cleveland, which make up more than half of the state’s holiday sales — are expecting spending declines, Heare said.
“Compared to the national economy, the Ohio economy is mute,” Heare said.
That’s evident in Ohio’s 0.8% growth that pales in comparison to the expected 3.8 to 4.2% growth nationally. On average, a U.S. shopper is expected to spend close to $1,048 during the holiday season.
Smaller metros like Dayton, Youngstown, Toledo, Akron and Lima are helping make up for the big city losses, said Christopher Nicak, co-director of research at the UC Economics Center.
“When you have a community like Dayton that has a low-cost of doing business and a low-cost of living, it allows you to spend more money on the things you want,” Kershner said. “We certainly have an economy that gives people the opportunity to be able to spend more on some of those purchases.”
Increased spending in Dayton is a major benefit, not just to retailers, but back to the customers, Kershner said.
“When you have increased spending in a community with local companies, that money stays local,” he said. “It helps benefit local employers; it helps benefit local employees; it helps provide for families. The more that consumers can do to keep that spend local certainly matters for the economic health of the community.
E-commerce sales have continued to grow, now making up about 10% of purchases, according to the U.S. Census Bureau. That growth is outpacing total retail sales, but tax revenues in Ohio are continuing to rise from the online purchases, according to the study.
“With the convenience of being able to purchase any time anywhere online…we do expect retail to be impacting our growth more in the future than it has in the past,” Nicak said.
FIVE FAST READS
Thank you for reading the Dayton Daily News and for supporting local journalism. Subscribers: log in for access to your daily ePaper and premium newsletters.
Thank you for supporting in-depth local journalism with your subscription to the Dayton Daily News. Get more news when you want it with email newsletters just for subscribers. Sign up here.