For America’s retailers, Christmas 2010 won’t be a bonanza, but it will be appreciably better than Christmas 2009.

This story first appeared in the January 12, 2010 issue of WWD. Subscribe Today.

That was the upbeat forecast springing from the National Retail Federation’s annual convention Monday, at a super session on “Recasting Retailing: New Rules and Opportunities.” The panel was moderated by Stacy Janiak, vice chairman and leader of the U.S. retail practice at Deloitte.

Mark Zandi, chief economist and co-founder of Moody’, predicted Christmas 2010 sales, excluding automobiles, will be up 3 to 4 percent. That compares with the better-than-expected 1 to 2 percent sales gain seen for Christmas 2009, and well above Christmas 2008, when sales were negative 3 to 4 percent.

“We are going to be pleasantly surprised by Christmas 2010,” said Zandi. “It will be a good Christmas. It won’t be boom-like. I am going to be an optimist. The economy today is measurably better than a year ago and will be measurably better a year from now.”

Zandi also forecast that job growth across various sectors, including health, education, technology and wholesaling, will be up 150,000 to 200,000 a year from now. “Even retailing by this time next year will be adding to the payroll.”

Job growth is the key to retailing’s success, stressed Allen Questrom, the former chairman and chief executive of J.C. Penney Co. Inc., Federated Department Stores Inc., Barneys New York and Neiman Marcus Group, who was also part of the panel.

“The real challenge for us is to have job growth,” Questrom said. “In the past decade, 30 million people were added to the population. But there was no job growth.”

Commenting on the holiday season, Questrom said he was “pleased” by how retailers fared in December. “The results were a little better than expected,” he said. “Retailers really looked at expenses. Retailers handled themselves remarkably, inventory was much better planned, much better thought out. I have never seen anyone go out of business because they didn’t have enough of something.”

Questrom was bullish on value retailers, like Wal-Mart Stores Inc., where he serves on the board, and Family Dollar Stores Inc., which was represented on the panel by its chairman and ceo Howard Levine. He also favors home repair stores like Home Depot and Lowe’s, considering many Americans postponed putting resources into their homes.

But the picture isn’t entirely bright. “I am positive versus negative but very concerned about what is going to happen this year,” said Questrom. “There is too much space in terms of the number of stores and the size of the stores. We have to continue to be aggressive on how we deal with capacity,”

He’s also worried about the possibility of the government imposing a value-added tax, or VAT, to get the deficit down. “A value-added tax would be very bad for retailing,” Questrom said. “You can’t have a VAT tax without raising prices. I don’t like VAT because it’s easy for government to do and they will keep going at it.…We are the only major country that doesn’t have a value-added tax.”

“Ultimately, at the end of the day, I think we are going to have a value-added tax,” said Zandi. Without running large deficits, the nation would still be in recession, Zandi said. Yet to reduce the national deficit, “We need big change” by cutting the growth in spending and raising taxes, Zandi said.

Levine said the company weathered the recession by focusing on opening price points, investing more in consumer research, and being “adaptable….We quickly culled back discretionary goods and tried to be more relevant.”

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