KINGSTON, R.I. – Nov. 26, 2025 – The rush to find the perfect gifts and gather with loved ones during the holiday season has commenced. How businesses both locally and nationally will fare this holiday season, though, is a bit murky.

According to S&P Global, holiday sales are expected to grow year over year, but price increases to offset tariffs will account for most of that growth. Also, S&P predicts that holiday retail consumer spending will remain relatively flat, which poses challenges for retailers.

In speaking with Rhody Today about the upcoming holiday shopping season, Nina Eichacker, associate professor in the University of Rhode Island’s Department of Economics, expects Rhode Islanders will be more selective in how much shopping they do this year and where. She also notes the rise of online shopping could impact seasonal employment locally. 

Overall, do you feel the holiday economy is going to be strong this year, both locally and across the U.S.? 

Spending always rises during the holiday season, compared to the months before and after. According to its consumer survey, the National Retail Federation is expecting close to 187 million people to shop from Thanksgiving Day through Cyber Monday this year, up from about 183 million in 2024. Nationally, sales are expected to rise approximately 4%. While projected spending is high, consumers expect to spend 1.3% less than they did last year ($890 per person compared to $902 per person). 

I expect that these trends will be similar in Rhode Island. In 2024, Rhode Islanders spent 3% more than they had in 2023. Rhode Island is a small state, so its annual spending is usually in the bottom fifth of the United States. Rhode Islanders, particularly those in vulnerable or volatile industries, will likely think hard about how much holiday shopping they commit to in 2025, and also what goods they decide to buy. 

What do you feel will be a major factor in the holiday economy flourishing in Rhode Island in 2025?

Rhode Islanders have been shifting more toward online shopping in recent years. Combined with higher prices on many goods due to tariffs, the rising cost of living, and economic uncertainty that has flowed from the government shutdown and the fact that we don’t know much about the state of the U.S. job market and other sources of economic uncertainty, I would expect that holiday shopping within Rhode Island is likely to be similar to national trends. 

However, there is a great deal of community support for local shopping across the state. Households who care to shop locally will most likely continue to make that a priority.

Retailers are expected to hire fewer seasonal workers this year than last year. What do you feel is contributing to this decreased need, the growth of online shopping notwithstanding? And, does this negatively impact the overall holiday economy in some way?

Apart from the growth of online shopping, I think that this reflects broader economic uncertainty. In the context of rising costs of living and higher prices due to tariffs, retailers are demonstrating that they believe the volume of shopping may not be as great, and it doesn’t make sense to have so many staff on hand. The Rhode Island state economy, as of August, appeared to be in a holding pattern – falling private sector jobs and the only source of employment growth appearing in state government. 

Because of the government shutdown, the U.S. Bureau of Labor Statistics has been unable to gather data on employment trends at the national and state levels, so we may see an amplification of those job trends when we finally have the data.

How will retailers respond to potential challenges to help ensure businesses will profit during the holidays?

Retailers will generally do their best to introduce more sales and bundles to get shoppers in the door, such as by offering Black Friday deals earlier and for longer, to entice more shoppers into stores or onto webpages. 

Will spending on holiday travel remain steady, or do you expect that to scale back a bit?

NerdWallet expects that Americans are going to travel a lot this year and spend $311 million on flights and hotels—or $2,586 per person—which is up nearly $260 per person from last year. Given the federal government shutdown and the prolonged period of air travel delays, cancellations, and complications, the potential for more complications exists. 

U.S. Transportation Secretary Sean Duffy argues that travel should proceed as normal. It’s worth noting that many Americans canceled or altered their plans in anticipation of a prolonged shutdown, which could mean lower-than-usual fares and potentially a bit more traffic on the roads.