Shoppers opened their purses more than expected in October as retail sales climbed 1.2 percent, the most in seven months.
The rise in consumer purchasing showed the biggest gain since March, and followed an 0.7 percent rise in September, the U.S. Commerce Department said Monday. Auto dealers led the way with a 5 percent gain, selling 12.2 million vehilces at a seasonally adjusted annual rate last month, the best since August 2009.
Americans are shopping again, which means the sputtering economic recovery is getting a much-needed jolt.
Joe Cardamone has been working for JC Penney for 36 years. Walking the aisles of his store, he sees signs of an economic turnaround in a pile of picked-over sweaters.
"We have every reason to believe it's going to be a good holiday for us," Cardamone said. "They're selling well. That's usually the sign of a good holiday season."
Companies are capitalizing on the shopping spirit, offering incentives to get customers to spend. Just this week, Walmart announced that it would offer free shipping on some 60,000 items over the holidays.
Not only is it the season of shopping, it's turning into the season of hiring.
"Consumers represent 70 percent of our economy in the U.S., so it's very important that they get confident enough to shop and spend in the holiday season," said Tig Gilliam, an executive from Adecco USA, a human resources services company. "That will further drive improvements in the job market."
Thousands of Seasonal Workers Hired
The retail industry is on the path to hiring the most seasonal workers since 2006.
In October alone, stores hired 150,900 workers, according to global outplacement firm Challenger, Gray & Christmas, Inc. That's three times more jobs than last year at this time, when just 47,600 holiday jobs were added.
The good news is expected to continue. Retailers plan to keep hiring through the season.
Best Buy plans to hire 29,000 seasonal workers. JC Penney said it would hire 30,000 workers. The toy superstore Toys "R" Us plans to add 45,000 people and the department store Macy's will hire 65,000 holiday workers.
"We're going through what appears to be our very best year we've had," Van Hersett said.
At Kismet, a clothing and accessories boutique with shops in Denver and Centennial, Colorado, owner Shana Colbin Dunn says business is great. She recently had to hire three new employees.
"We expect a really busy holiday season and so we just need all the help we can get," said Colbin Dunn. "Because the worst thing is to not be prepared when the customers come in."
Those employees, she says, will likely stay on after the holiday rush.
White Collar Workers Hoping for Holiday Work
Still, with the unemployment rate staying stubbornly high at 9.6 percent and more than 14 million people out of work, the competition for the holiday jobs is stiff.
ABC News spotted Rifat Rahman filling out a stack of applications. She's been looking for a job for months.
"How many people are applying for the same job? Hundreds," Rahman said.
Former white collar workers are lining up to fold sweaters and stock shelves.
Back at JC Penney, Cardamone said that he has more applications than he can handle. He's hiring 150 workers but has thousands of applicants, many of whom are older and have college degrees.
"They're just out of work and they just want something," he said. "It's outstanding. ... Of all of the years that we've hired, I think this time around, quality is far superior to what we've been used to seeing in the past."
That may be good news for the months beyond the holidays, too. Economists said that how consumers and retailers behave this holiday season will impact the economic forecast for 2011.