Anemic back-to-school shopping begins shaky holiday season

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Most analysts believe that back-to-school shopping revenue is second only to the year-end holiday season for producing sales. This year, retailers are disappointed by the school-shopping season, at least up to now. Nationwide, average family spending on back-to-school items, not including expenses for college students, is expected to drop from $600 to $550, according to The Tampa Tribune.

While a sharp drop in retail spending during August may not cripple the retail industry and cause store closings, if the problem extends into October and November, the 2009 holiday season could look like a repeat of last year. Retail industry sales were down 2.2 percent last year, marking the worst drop since 1970.


The holiday season could actually be unexpected bad this year. Unemployment may reach from 9.7 percent to 9.8 percent by October. That is substantially higher than a year ago. More people are working part-time now and many more have had their work hours cut back by the companies that employ them in an effort to save money.

Several well-know retailers were mortally crippled because of late 2008 sales. For companies, like Macy's (NYSE:M) and Target (NYSE:TGT), which have already had tough years, disappointing year-end figures could cause more store closings and lay-offs.

With school sales down, there is no reasons for the retail industry to be optimistic about the holiday.

Douglas A. McIntyre is an editor at 24/7 Wall St.

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