Consumer spending is a vital indicator of the financial health of a country. Luckily for both kids and the economy, Santa has been classified as a key worker, is exempt from quarantine, and was personally vaccinated by the top infectious disease expert in the US, Dr. Anthony Fauci.
Since October, politicians around the globe have been assuring families that Mr. Claus’s travels are “essential,” and that he will still arrive, presents in hand, despite restrictions on movement, gatherings, and local lockdowns. They have good reason to press the issue.
In addition to encouraging much-needed consistency for children in an otherwise turbulent year, politicians have a strong economic imperative to emphasize end-of-year consumerism. While an economy’s health can’t be judged on Christmas spending alone (this is why economic data are seasonally adjusted), the amount of goods bought and sold over the holidays remains an important indicator. Consumer spending makes up over 60% of the GDP in the UK, and nearly 70% in the US.
Traditionally, about a fifth of annual retail spending in the UK happens in the run-up to the holidays. While the retail sector itself only comprises about 5% of the British economy, it provides 3 million jobs. This year, with a global economy in recession, Christmas spending will be make-or-break territory for many shop owners.
It’s unclear if all the political encouragement has yet led to an appreciable increase in holiday spending, and the volatility of 2020 has made it near impossible this year to predict retail consumer patterns.
Early signals, however, aren’t encouraging. In the US, retail sales fell in October and November and consumers spent less over the five-day stretch that includes Black Friday and Cyber Monday than they did a year ago. In the UK, holiday plans were thrown into disarray with a sudden and unexpected lockdown five days before Christmas, limiting foot traffic to stores on crucial shopping days.
We’ll just have to wait a little longer to see whether holiday spending hopes were realized, or were simply a figment of Christmas imagination.