LOS ANGELES U.S. holiday spending is expected to be flat versus a year ago, as consumers remain cautious and the national unemployment rate hovers at nearly 10 percent, Deloitte said in a forecast released late on Sunday.
Deloitte's retail group expects total holiday sales to be $810 billion, excluding motor vehicles and gasoline, for the November-through-January period.
A flat result would be an improvement from a year ago when holiday sales fell 2.4 percent, but is hardly the encouraging sign some retailers and investors would hope for.
"Although there are signs that suggest the economy is nearing the end of its darkest days, many consumers remain burdened by restricted credit availability, high unemployment and foreclosures," said Carl Steidtmann, chief economist with Deloitte Research, a subsidiary of Deloitte Services LP.
"Americans continue to save at historically high rates while also paying down debt, and these factors combined suggest another chilly holiday season for retailers," Steidtmann said.
He added that stable gas prices, strengthening home values and stock market gains would help support consumer spending during the all-important winter holiday season that starts on the Friday after the U.S. Thanksgiving holiday.
While some data is pointing to an early economic recovery, many experts agree that consumers are not yet out of the woods.
U.S. unemployment hit 9.7 percent in August and is expected to top 10 percent in what many economists are predicting will be a jobless recovery.
Federal Reserve Chairman Ben Bernanke said last week that the U.S. recession "is very likely over," his most optimistic remark yet on recovery.
U.S. retail sales were up a better-than-expected 2.7 percent in August, their fastest pace in 3-1/2 years, helped by the U.S. government's "cash for clunkers" program.
Best Buy Co, the nation's largest electronic chain, recently raised its full-year forecast on improving sales trends and stabilizing customer traffic after reporting that profit in its most recent quarter was weakened by promotions and sales of low-margin notebook computers.
Famed investor Warren Buffett said the "terror" that followed last year's near-collapse of the financial system has dissipated, but that he does not believe the United States has begun to climb out of the worst recession since the Great Depression.
"A year ago you had a lot of uncertainty, but you didn't have a lot of layoffs outside the financial services area," said Stacy Janiak, vice chairman and U.S. retail leader for Deloitte.
Janiak said that consumers have had a year to learn to stretch every dollar and expects holiday spending to be "controlled and conscious."
She does not expect that consumers will find as many deep discounts as last year.
"I don't think we're going to see the same extreme promotion at the end of the season," said Janiak. "Retailers appear to have prepared themselves for a challenging season by adjusting inventory and closely managing their expenses."
(Reporting by Lisa Baertlein, editing by Matthew Lewis)