Holiday sales in Ohio are expected to increase 3.4% this year compared with the last year, according to a forecast issued this week that shows shoppers worried about inflation, the economy and higher interest rates.

Total retail sales − defined as sales that exclude gasoline, auto and food − are expected to hit $31.3 billion this year in Ohio, according to the report from the Ohio Council of Retail Merchants and the University of Cincinnati Economics Center. This will mark the 10th straight year of growth of Ohio holiday sales.

The 3.4% growth rate is below national forecasts, which have ranged from 4% to 8%, according to the report.

The forecast measure sales in October, November and December compared with the prior year. The report covers sales in stores and online.

The forecast is based on sales tax data collected by the Ohio Department of Insurance going back to 2005. The report also factors in employment and wages in Ohio, national retail sales, household debt, inflation, consumer confidence and the potential for a recession.

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The forecast predicts sales increases in all nine metro areas in the state that it looked at, led by a 17.5% increase in Mansfield. Mansfield makes up a tiny portion of overall sales in the state, 1.1%, and given its small size, the data used in the forecast may be less reliable than in larger metro areas.

“Overall, this sales forecast shows Ohio’s economy is growing stronger, and we are well on our way to full recovery from the economic impact of COVID-19,” Gordon Gough, the council's president and CEO, said in a statement.

The forecast is about half of the 7.3% growth predicted last year, a forecast that proved optimistic. Ohio sales last year were expected to hit $31.4 billion, but ended up at $30.3 billion.

The report notes that Ohio shoppers face several headwinds this holiday season − inflation, rising interest rates, increased housing costs and consumer confidence below where it was before the pandemic struck. Ohio has yet to recover all the jobs that were lost during the early days of the pandemic.

On the plus side, center researchers found that wages increased 12.3% from the beginning of 2020 through June 2022.

“Consumer confidence is still below its peak in February 2020 before the pandemic, but we’ve seen a partial recovery, and that, coupled with the salary growth, are factors in our forecast for higher holiday sales this year," said Brad Evans, UC Economics Center director of research.

The Columbus metro area will generate 20.6% of state's retail sales, more than any other region. Cleveland is second at 17.9%.

mawilliams@dispatch.com

@BizMarkWilliams

Sales forecast by region compared with the same period a year ago:

• Akron, 8.2%

• Cincinnati, 0.2%

• Cleveland, 3.8%

• Columbus, 2.7%

• Dayton, 5.3%

• Lima, 4.9%

• Mansfield, 17.5%

• Toledo, 11%

• Youngstown, 10.5%

Source: Ohio Council of Retail Merchants and the University of Cincinnati Economics Center

This article originally appeared on The Columbus Dispatch: Mansfield expected to lead Ohio metros holiday sales forecast