According to Mastercard SpendingPulse, the season is expected to see an 18.3% increase compared to pre-pandemic levels observed in 2019.
“Back-to-school is the second-biggest season for retailers and is often looked at as an early indicator of retail momentum ahead of the traditional holiday season,” said Steve Sadove, senior advisor for Mastercard and former CEO and chairman of Saks Inc.
“While Mastercard SpendingPulse anticipates growth across sectors, retailers will need to find innovative ways to entice shoppers as discretionary spending potentially stretches thin as a result of increasing prices.”
Department stores are expected to be the clear winners, with sales projected to grow by 13% year-over-year and 27.3% compared to 2019. The increase in sales will likely result from consumers’ return to shopping in physical stores, with in-store sales rising by 8.2.% year-on-year and 9.9% when compared to 2019 levels.
“The continued retail sales momentum in May aligns with the sustained growth rates we’ve seen so far this year,” said Michelle Meyer, U.S. chief economist, Mastercard Economics Institute. “The consumer has been resilient, spending on goods and increasingly services as the economy continues to rebalance. That said, headwinds have become stronger – including gains in prices for necessities like gas and food, as well as higher interest rates.”
