How Halloween Spending Affects the Economy

How Halloween Spending Affects the Economy

Happy Halloween! 

Did you know? The origin of this spooky holiday dates back to the ancient festival of Samhain, a Celtic tradition. When Irish immigrants came to America in the second half of the 19th century, they brought along their traditions and helped to make Halloween a popular national celebration. Over time, Halloween has become one of the most widely celebrated holidays in the United States, especially for children and families who enjoy Trick-or-Treating.

Have you ever wondered how Halloween affects our economy? After all, those pumpkins, decorations, costumes, and candy do have to be purchased every year, and typically fly off the shelves. In this post, we’ll review some of the frightening facts on Halloween spending. But first, a bewitching poem:

Tonight’s the night when spooks abound,

and candy will be all around.

Children walk the streets this night,

in search of treats and perhaps a fright.

Read on and surely you will find

payment facts that transfix the mind.

Before the eve we will explore

how Halloween spending grows more and more.

 

Halloween Projected Spending for 2019

How much will you spend on Halloween this year? Depending on your family size and dynamic, experts estimate that it could be an average of $86 per person.

According to the National Retail Federation (NRF), adults in the United States will spend an estimated $8.8 billion on costumes, candy, and other Halloween swag this year. That’s not too far off from the record-high for Halloween spending, which cashed in at $9.1 billion in 2017. Check out these other forecasted amounts for Halloween this year:

  • Americans spend an average of $86 per person on Halloween items.
  • Spending on costumes for children, teens, adults, and pets is estimated to reach $3 billion this year.
  • Halloween candy sweeps in over $2 billion each year.
  • It is estimated that Americans will spend $2.7 billion on decorations this year.

Where do you fall on the Halloween spending list? Even if you don’t have children to take Trick-or-Treating, you may still end up spending quite a bit on candy to pass out to the neighborhood ghouls and goblins. In fact, it is estimated that 69% of households will pass out candy, but only 29% of parents plan to take their children trick or treating this year. 

 

Halloween Spending vs. the U.S. Economy

So, how will all that spending affect the United States economy?

Economists have been examining this question over the years but have yet to come to a solid consensus. Some argue that the state of the economy itself affects the Halloween industry more than Halloween affects the state of the economy. For example, after the Great Recession of 2008, Halloween spending decreased to just $56 per person. Once the economy began to resurge, so did Halloween spending - reaching $66 per person in 2010 and $72 per person in 2011. These numbers have only continued to climb since the recession, reaching a record high in 2017. Experts believe that the healthier state of the economy has helped increase consumer confidence, making us more likely to spend our earnings on non-essential products, such as costumes, candies, and decorations.

Other economists believe that an increase in spending on Halloween merchandise always has a positive effect on the state of the economy. According to Investopedia, “Increased spending generally leads to higher gross domestic product (GDP), helping to jump-start economic activity and lead to potential job growth.” Halloween-specific retailers, such as Spirit Halloween, help to stimulate the job market by hiring temporary employees to run the retail store. This stimulation then continues through the holidays, as many large retailers hire additional, temporary staff to work the extended hours required to meet consumer demand.

The Halloween shopping season can also be an opportunity for retailers such as craft stores and mass merchants like Walmart or Target to begin teasing holiday specials. It may seem like overkill when you start seeing Christmas trees in stores before Halloween, but the retail industry pushes these items early because it relies heavily on holiday shopping. In fact, that’s when about 20 percent of all retail sales for the year occur.

To summarize, the answer to this question is a bit ambiguous. Like a distorting mirror in a haunted house, it depends on which way you look at it. At one angle, the state of the economy affects Halloween spending. From the other angle, we see that Halloween spending can help stimulate the economy.

 

Trick or Treat! Other Halloween Fun Facts

Hungry for more? Check out these Halloween facts that may surprise you:

  1. In 2018, it is estimated that about $575 million was spent on Halloween pumpkins, exhausting about 80 percent of the pumpkin supply in the United States.
  2. Rubie’s Costume Company is the world’s largest designer and manufacturer of costumes and produces almost half of all costumes worn during the Halloween season.
  3. According to a recent poll, the most popular Halloween candies are as follows:
    • Reese's Peanut Butter Cups - 36%
    • Snickers - 18%
    • M&M's - 11%
    • Hershey bars - 6%
    • Candy corn - 6%
    • Skittles - 5%
    • Starburst - 4%
    • Tootsie Pops - 2%
  4. 1 in 9 adults will dress as a witch for Halloween this year.
  5. 17% of Americans will purchase a costume for their pet, with a pumpkin being the most popular costume.

 

Whether you’re taking the family out trick-or-treating or enjoying your favorite candy at home, we hope you have a frighteningly fantastic Halloween! 🎃

 

Sources: History.com, NRF, Investopedia, ConsolidatedCredit, The Balance, FEE, Retail Dive