Americans increased holiday spending this year but at a slower pace

Holiday sales rose this year and spending remained resilient during the shopping season even with Americans wrestling with higher prices in some areas and other financial worries, according to the latest measure. Holiday sales from the beginning of November through Christmas Eve climbed 3.1%, a slower pace than the 7.6% increase from a year earlier, according to Mastercard SpendingPulse, which tracks all kinds of payments including cash and debit cards. This year’s sales are more in line with what is typical during the holiday season, however, after a surge in spending last year during the same period. “This holiday season, the consumer showed up, spending in a deliberate manner,” says Michelle Meyer, chief economist with the Mastercard Economics Institute. “The economic backdrop remains favorable with healthy job creation and easing inflation pressures, empowering consumers to seek the goods and experiences they value most.” The number of people seeking unemployment benefits has remained low by historical standards and employers are still having a hard time finding enough workers. Still, sales growth was a bit lower than the 3.7% increase Mastercard SpendingPulse had projected in September. The data released Tuesday excludes the automotive industry and is not adjusted for inflation. Clothing sales rose 2.4%, though jewelry sales fell 2% and electronics dipped roughly 0.4%. Online sales jumped 6.3% from a year ago and in-person spending rose a modest 2.2%. Consumer spending accounts for nearly 70% of U.S. economic activity and economists carefully monitor how Americans spend, particularly during the holidays, to gauge how they’re feeling financially.