A fresh round of stimulus checks in Americans' bank accounts before the end of the year could provide a welcomed boost to retailers this holiday season, according to a new study.
Assuming no additional government stimulus, 37% of consumers said they are likely to spend less money during the holidays, while only 16% plan to spend more on gifts, the Franklin Templeton-Gallup Economics of Recovery study found.
However, assuming there is a $1,200 stimulus payment, the percentage of people planning to spend less falls to 30%, while those planning to dole out more cash on gifts jumps to 22%, according to the poll, which is based on the online responses of 5,002 people from Oct. 1 to Oct. 9.
After the government issued millions of checks to consumers as part of a historic $2 trillion relief package Congress passed in March, consumers were able to shift away from buying only necessities such as groceries and toiletries to splurging on new technology and home improvement items.
But that temporary boost has largely faded, unemployment remains high, and many Americans are trying to budget their way through the holiday season, as uncertainty around the trajectory of the pandemic abounds.
America recorded more than 150,000 new Covid cases Thursday, for the first time since the pandemic took hold in the country roughly nine months ago. Also Thursday, Chicago Mayor Lori Lightfoot asked residents to cancel their Thanksgiving plans and stay at home unless they need to go to work or school or to make essential trips like to the grocery store.
Analysts say it is going to be difficult for lawmakers to pass any pandemic relief legislation before Inauguration Day on Jan. 20. It does not appear to be a priority for President Donald Trump, who has been contesting the election results since Nov. 3. President-elect Joe Biden has listed coronavirus aid as one of his top priorities when he enters office.
That aid just might not come soon enough to save the holidays.