Local retailers might have good reason to be optimistic this holiday season due to several indicators pointing toward robust spending.

Numbers provided by the Texas comptroller show 2012 already offered the strongest first quarter of taxable retail sales in the Killeen-Temple-Fort Hood metropolitan statistical area’s history. Given the boost holiday spending traditionally gives the fourth quarter, the local MSA could see record numbers in 2012.

Several research firms are predicting a return to prerecession holiday spending levels this year. Chicago-based analytics firm comScore predicts 17 percent growth in online spending, while the New Hampshire-based American Research Group predicted a jump from $646 to $854 per person in Christmas gift spending, representing a 32 percent increase since 2011. The National Research Federation predicted overall sales in November and December will rise to $586 billion in 2012.

“The 2012 online holiday shopping season is off to an encouraging start with a 16 percent growth thus far,” said comScore chairman Gian Fulgoni in a statement. “Recent five-year highs in consumer confidence and early retailer promotions appear to be serving as wind in the sails for the beginning portion of the holiday season, with consumers opening up their wallets early and often.”

Recession recovery

According to the comptroller’s office, the Killeen-Temple-Fort Hood MSA’s taxable fourth-quarter retail sales increased from about $342 million in 2002 to about $467 million by 2007. While fourth-quarter taxable retail spending remained the strongest quarter each year, in 2008 the fourth-quarter total taxable retail sales flattened out before taking a distinct dip.

Taxable retail sales in the Killeen-Temple-Fort Hood MSA decreased by about 5 percent between 2007 and 2008, to about $450 million. But despite the bad economy, local numbers trended upward between 2008 and 2011. By 2011, local taxable retail revenues were actually exceeding prerecession fourth quarter numbers.

The Killeen-Temple-Fort Hood MSA got a boost in 2012 as troops returned home. Husband and wife Oscar and Rachel Ornelas were both deployed last year. They each said they plan to spend more on Christmas gifts now that they are back in the United States.

“I think because of the job security in the military, we are a little less afraid to spend money on Christmas gifts,” said Oscar as he loaded his car with freshly purchased gifts in the parking lot of Target in Harker Heights.

The couple, who has four children between the ages of 3 and 11, agreed they would likely exceed $800 in total holiday spending.

“Regardless of the economy we would probably spend that much. It’s for the kids,” said Oscar Ornelas.

Mother and daughter Verna Jones and Abeni Randle do their holiday spending much more conservatively. They started off at Kmart at midnight Thursday and found themselves at Ross Dress for Less in Killeen around 9 a.m. Friday. Despite spending almost half a day shopping, they did not think they would come anywhere near spending $800 on gifts.

“I really don’t think how much people spend is necessarily a reflection of the economy,” said Randle, who was visiting Jones from Tennessee. “No matter what, people are going to shop. Whether the economy is good or bad, people are going to shop.”

Mixed views

Killeen resident Shawn Contino resides on the high side of the American Research Group’s prediction. He contemplated how much he will spend this holiday season as he balanced several boxes of Star Wars figurines on a trade paperback of “The Walking Dead” at the Barnes & Noble in Market Heights.

“I just dropped $2,000 on a TV,” Contino said. “We’ll probably spend $5,000 this year. But keep in mind, we have eight grown kids and 13 grandkids.”

Contino said “an improved financial position” is allowing him to spend more.

“We will spend a little bit more than last year,” he said. “I have been able to pay a lot of stuff off, and I have more money freed up for gifts.”

Penny Barkin could not disagree more about the economy. She said she is afraid the Affordable Health Care Act will cause a lot of people to lose their jobs soon. But she still managed to sock away $1,400 to spend on her grandchildren this holiday season.

“We are actually cutting back,” said Barkin in the snack bar at Target in Market Heights. “We’re only buying gifts for the kids this year, not the adults.”

Contact Mason Lerner at mlerner@kdhnews.com or (254) 501-7567

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