Decking the halls

How much do we spend on decorations? 

Americans splash some $6 billion a year on festive decor. We buy 30 million real Christmas trees and 20 million artificial ones, 150 million sets of Christmas lights, 70 million pots of poinsettia, and millions more ornaments, yard decorations, and window decals. Some “extreme” decorators pay big to transform their homes into elaborate Christmas villages with brilliant light displays and animatronic characters. Mike Bagwell of Springfield, Mo., estimates he’s spent more than $130,000 on holiday decorations over the years, including on the 270,000 LED lights that adorn his home. “When you see the [community’s] laughter and the joy, it just makes it all worthwhile,” he said. All that sparkle adds to utility bills: Americans’ holiday lights collectively use 3.5 billion kilowatt hours of electricity each December—enough to power more than 350,000 homes for a year—at a cost of about $645 million. Then there are the seasonal medical bills, because 18,400 of us end up in the ER with decorating injuries having, for instance, fallen from a ladder while hanging lights. Still, the emotional dividends of decorating can be profound. “If you haven’t had a great year,” says psychologist Pauline Wallin, “it can put you back in touch with pleasant memories.” 

What’s the history of decorating? 

Some Yuletide adornments go back to pagan times: Pliny the Elder wrote of Celtic druids’ reverence for mistletoe. But modern holiday decor really took shape in the 19th century. Joel Roberts Poinsett, the first U.S. ambassador to Mexico, came home in 1828 with a shrub that bloomed red in winter. Called flor de Nochebuena (flower of Christmas Eve) in Mexico, it’s now known across much of the world as poinsettia. In 1856, following a craze sparked in the English-speaking world by Queen Victoria, President Franklin Pierce unveiled the first Christmas tree at the White House. Around the same time, a craftsman in the German town of Lauscha began blowing glass tree ornaments in the shape of spheres and fruit and nuts, then silvering them inside and painting the outside. In 1880, retailer F.W. Woolworth reluctantly agreed to buy a box of the ornaments from a German salesman. Woolworth thought the “useless” decorations wouldn’t sell, but customers at his Great Five Cent Store in Lancaster, Pa., snapped up all 144 in a matter of hours. Woolworth quickly placed a new order; over the next 60 years, his retail empire would sell 500 million baubles. 

What about Christmas lights? 

They were a homegrown invention. After Thomas Edison patented the first practical incandescent light bulb, he strung a few together outside his Menlo Park, N.J., laboratory for the 1880 Christmas season. Two years later, Edward Hibberd Johnson— Edison’s business partner—wrapped a string of 80 red, white, and blue bulbs around his Christmas tree. Placed on a rotating platform in the parlor of his Manhattan home,  the tree mesmerized passersby. “One can hardly imagine anything prettier,” said one reporter. Those early illuminations were pricey: It cost the equivalent of $10,000 today to have electricians install tree lights and be on call if a bulb burned out. But in 1903, Edison’s General Electric debuted the first mass-market string of Christmas lights, which cost $12 (more than $400 today) and was marketed as a safe alternative to the candles traditionally placed in trees. In the 1960s, plastic “blow mold” lawn ornaments shaped like reindeer and Santa Claus exploded in popularity, but sales sank in the 2000s as inflatable decorations took over yards. 

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Where did they come from? 

They were dreamed up by same firm behind Big Mouth Billy Bass, the animatronic singing fish. Texas-based Gemmy Industries was looking for a follow-up hit when co-owner Dan Flaherty wondered if he could make a consumer version of the inflatable animals often seen outside car dealerships. Early prototypes used hair dryers, which overheated and burned out, but Gemmy eventually devised a fan that could blow for months on end. In 2001, it launched its first inflatable—an 8-foot Santa—and now sells scores of seasonal specials, including a 7-foot shotgun-wielding Santa in a deer stand. In 2014, American entrepreneur Lou Lentine introduced another holiday innovation: a laser projector that speckles homes with festive lights. He devised the Star Shower as a safe, ladder-free way to illuminate a home, but the Federal Aviation Administration has warned that the lasers can pose “a serious safety risk to pilots” when misaimed. Americans who shopped for such gizmos and other holiday decorations this year likely noticed many prices were up from 2024. 

Why is that?

Because of President Trump’s tariffs on China, the source of 87% of all Christmas decorations. Import duties on Chinese goods skyrocketed to 145% this spring, before dropping to about 40%. Despite that fall, industry leaders warned that Americans would have to pay 18% more for decorations. Small businesses that import holiday decor have so far spent over $400 million on tariff fees, up 1,438% from last year. “We went from working toward a profit to working for tariffs,” said Jared Hendricks, who runs Village Lighting in West Valley City, Utah. 

Are Americans cutting back?

They say they are. In an October poll, only 39% of respondents said they’d buy new decorations this year, down from 56% in 2024. Still, the National Retail Foundation reports a record 202.9 million Americans shopped for Christmas items during Thanksgiving Week, and it expects overall holiday spending to top $1 trillion for the first time this year. Matthew Shay, the trade group’s CEO, suspects Americans won’t let economic gloom ruin the holiday. “Somehow,” he said, “Santa Claus always comes.”