While Americans were getting ready for the holiday season, the United States Chamber of Commerce delivered what might have been the most coveted gift of all: a report that claims that 2011 was ending on an economic high note. In fact, many analysts say the economy may have grown by as much as 3 percent from October to December, which the chamber said would represent the largest growth since spring of 2010.
Part of this sudden economic boom came from record holiday sales. According to a recent survey by digital tracker comScore, online sales hit $36.3 billion during the first 56 days of November and December, a 15 percent increase from the same period a year earlier. And just 10 days before Christmas, the National Retail Federation revised its projection of holiday sales to $469.1 billion, up from its own October estimates of $465.6 billion.
Strong holiday sales were not the only factor, however, in 2011's strong finish. While holiday shopping reached an all-time high in 2011, the Chamber of Commerce says many other economic indicators ended the year unexpectedly healthy.
- Unemployment decrease. During the week before the Chamber's Dec. 22 report, unemployment dipped four-tenths of a percentage point to 8.6 percent, its lowest level since March 2009.
- Job creation. Employers have added at least 100,000 jobs a month for the past five months, the longest streak since 2006. In November 2011 there were 120,000 jobs added, according to the December 2011 jobs report. Small businesses may be the driving force behind continued success in 2012, according to a report released this week (Jan. 3) by payroll company SurePayroll. It found that 50 percent of small-business owners plan to hire in 2012 and 56 percent intend to raise wages for employees.
- Consumer confidence. The Conference Board, a business group that tracks the mood of consumers, reported that the 15-point jump in consumer confidence from October to November represented the biggest one-month jump since April 2003. The index stood at 56 for November.
- Falling gas prices. Gasoline prices approached $4 a gallon in May before settling at an average of $3.21 in recent months, allowing people to focus on spending elsewhere instead of at the gas pump, according to the AAA Daily Fuel Gauge, the chamber report said.
- Increase in inventories. With an increase in sales seen in recent months, businesses are restocking their shelves. October saw an 8.7 percent increase in inventories at businesses from a year ago. According to the Chamber of Commerce, this growth of inventories could represent a third of economic growth this quarter.
- Strides in housing. Construction of new homes rose by 9 percent in November from the previous month. Additionally, the National Association of Realtors recently stated that sales of previously occupied homes rose by 4 percent in November. The numbers, however, remain below the rate that would be considered healthy for the housing market.
Reach BusinessNewsDaily staff writer David Mielach at Dmielach@techmedianetwork.com. Follow him on Twitter @D_M89.