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Dec. 26, 2021, 4:18 p.m. EST

COVID-19 disrupts travel, but holiday shopping rises at fastest pace in 17 years

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By Associated Press

NEWARK, N.J. — The latest COVID-19 variant is upending holiday plans for tens of thousands of travelers — but it didn’t do much damage to holiday shopping.

Airlines canceled hundreds more flights Sunday, citing staffing problems tied to  COVID-19 , as the nation’s travel woes extended beyond Christmas, with no clear indication when normal schedules would resume.

But shoppers shrugged off the omicron variant, and holiday sales rose at the fastest pace in 17 years, according to one spending measure.

Omicron is likely to slow the economy’s unexpectedly strong rebound from last year’s coronavirus recession, disrupting travel and likely discouraging some consumers from venturing out to shops, restaurants and bars. The variant could also add more heat to already simmering inflation by forcing shutdowns of factories and ports, delaying shipments and driving up prices.

“A full reopening of the U.S. economy will be delayed yet again,’’ said Robin Brooks, chief economist at the Institute of International Finance, a trade group of financial firms.

But it’s not yet clear how deep the hurt will go or how long it will last.

For now, the variant is playing havoc with travel. More than 700 flights entering, leaving or flying within the U.S. were called off, according to the flight-tracking website FlightAware. That figure was down from nearly 1,000 on  Saturday . More than 50 flights were already canceled for Monday.

Delta /zigman2/quotes/200327741/composite DAL -1.53% , United /zigman2/quotes/205037281/composite UAL -1.49% and JetBlue /zigman2/quotes/207639051/composite JBLU -0.59% have blamed the omicron variant of the coronavirus for staffing shortages that forced cancellations.

“This was unexpected,” United spokesperson Maddie King said of omicron’s impact on staffing.

Globally, airlines scrapped about 2,200 flights as of Sunday morning, down from more than 2,800 cancellations the day before, FlightAware’s data showed. The site does not say why flights are canceled.

JetBlue scrapped 10% of its flights Sunday. Delta canceled 5% and United canceled 4%, according to FlightAware. The three airlines canceled more than 10% of their scheduled flights on Saturday.

American Airlines /zigman2/quotes/209207041/composite AAL -2.93% spokesperson Derek Walls said the Christmas cancellations stemmed from virus-related sick calls.

Despite omicron, American consumers appeared undaunted. Mastercard Spending Pulse, which tracks all kinds of payments including cash and debit cards, reported Sunday that holiday sales had risen 8.5% from a year earlier, the biggest annual gain in 17 years. Mastercard SpendingPulse had expected a 7.4% increase.

The results, which covered Nov. 1 through Dec. 24, were fueled by purchases of clothing and jewelry. Holiday sales were up 10.7% compared with the pre-pandemic 2019 holiday period.

After omicron hit, some consumers shifted their spending to e-commerce, but sales stayed strong.

“I feel really good about how the season played out,’’ said Steve Sadove, senior adviser to Mastercard /zigman2/quotes/207581792/composite MA +1.19% and former CEO of Saks Inc. “When people feel a little bit uncomfortable, you’ll see a little bit of a pickup in online and a little bit of a slowdown in store performance.’’

Sadove said consumers are “learning to live” with what COVID-19 throws at them.

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