A recent MediaPost article, written by Sarah Mahoney, featured forecasts that the retail sector is expected to bounce back in 2010. After suffering for over a year, two retail industry organizations say that 2010 retail sales will see gains of at least 2.5%. The National Retail Federation has predicted decreased unemployment combined with a stronger housing market will boost sales in 2010, which were down 2.5% overall in 2009. The experts at Retail Forward are more optimistic,  forecasting a 1.5% to 2% gain in the retail sector in the first half of 2010, gains of up to 4% in the second half of the year.

However, according to Retail Forward economist Frank Badillo, these predictions remain nothing more than that: “Renewed job and income growth will ultimately outweigh other drags on the recovery, such as tighter credit availability and new credit regulation.” Badillo continues, “…and we’ve seen some real improvement in consumer confidence levels since last March. But if confidence and the overall mood of the country were to turn more negative, that could threaten the outlook.” Within the retail sector, food, drug and mass, and soft goods will continue to perform best in 2010. Each of those sub-sectors are expected to see gains of 2.5% in the first half of 2010, and 4% in the second half.

According to Rosalind Wells, NRF Chief Economist, “As we continue to see signs of improvement throughout the U.S. economy in 2010, overall sentiment will begin to lift, making way for slight increases in consumer spending.” She goes on to say that, “…while we still expect shoppers to continue to be frugal with their discretionary spending, retailers will soon be able to reap the benefits of leaner, smarter inventories and a year and a half of pent up consumer demand.” Following the recent economic downturn the retail industry could certainly use the boost that is predicted for this year. Needless to say, much remains to be seen.

via Sarah Mahoney @ MediaPost