Throughout the COVID-19 pandemic, the word “unprecedented” got thrown around a lot. Although this free use of the word is now pretty precedented, COVID-19 has found a way to shake up our lives once again: The holiday season.
It should come as no surprise that this year will be much different from last and in more ways than one. There has been a huge supply chain shortage which will come to define the year and prices are shooting up. All of this is coming to a head as the holidays near.
According to the business data website Statista’s report on the U.S. Christmas season “In 2020, total holiday retail sales were projected to reach about 750 billion U.S. dollars.”
Albert Williams is the chair of Finance and Economics Department at the Huizinga College of Business and Entrepreneurship and an associate professor of finance and economics. Williams described the major supply shortage that many stores will face this holiday season and how inflation will impact it.
“Nobody was making anything across the world. Because of COVID-19 the factories weren’t working, the workers were not there, and so now the demand is picking up and they haven’t really caught up with the technical supply chain issues at the ports, especially in California were there are over 100 ships still sitting on the harbor not coming in to remove their containers. The shelves are not as full as they were two years ago,” said Williams.
This backup at the ports has coupled with the increase in fuel price, which has trickled down to the consumer’s pockets.
“If you have fuel prices increasing, that in of itself will tell you that some of these goods need major transportation to get them from across the country and that will in fact cause the prices to go up. So, the shipping cost will get higher and therefore you will see an increase in the cost of these products,.” said Williams.
However, this won’t be the only reason this Christmas will be different from last years. The average consumer does have more money saved up from one of the many stimulus checks or from acquiring a new job, making the consumer buying power stronger, according to Williams.
Williams also stated, “There are close to 55 million people traveling for Thanksgiving,.” which assures major pressure on the fuel industry.
According to a bureau of labor statistics report in October, the inflation rate for the month was at 6.2%, higher than what the average monthly inflation rate is.
Williams advised shoppers to be “very, very vigilant and would encourage consumers to do more brick-and-mortar shopping. Go to the stores and grab the item and take it home,” adding “please don’t wait for the last day before your holiday to buy your goods this season.”
