Downtown merchants are setting aside gifts for less than $50 and gearing up for the second annual Shop and Hop event Thursday from 5 to 10 p.m. to get a jump start on the holiday season.

Westfield Annapolis mall, decked out with holly, ornaments and Christmas trees, is offering its gift with purchase promotion for those who spend $300 or more at any new mall stores during the Westfield Annapolis 1st Anniversary Weekend. The promotion runs Friday through Sunday and shoppers who spend that amount will receive a $25 gift card to a restaurant of their choice.

And the newly opened Target at the Annapolis Towne Centre at Parole complex is focusing more on the "pay less" side of the company's "expect more, pay less" slogan, said Hadley Barrows, spokesman for Target.

"We have a number of different values at different price points," she said.

Stores are holding promotions to lure consumers dealing with sliding home values, sinking stock portfolios and worries over job security. National unemployment has risen from 6.1 percent to 6.5 percent. The latest numbers released in October show unemployment in Anne Arundel was 4 percent, up from 2.4 in May, according to the state Department of Labor Licensing and Regulation.

Dr. Daraius Irani, director of applied economics for the Regional Economic Studies Institute at Towson University, said the tightening up of credit has impacted businesses' ability to expand, "which means they are not adding jobs," he said. "They may be laying off or not replacing workers."

Even so, consumers are not canceling Hanukkah, Kwanzaa or Christmas this year. The National Retail Federation reports that consumers plan to spend an average of $832.36 on holiday-related shopping, a 1.9 percent increase from $816.69 last year. It marks the lowest increase in consumer spending since the survey's start in 2002.

At the Annapolis mall Friday, Victoria Kopec said she planned to spend the same amount of holiday money as last year.

And Ms. Kopec said she wasn't worried about job security because she has a nursing job at Anne Arundel Medical Center. But she is concerned about the economy's affect on her retirement fund.

"I don't want to lose it," she said.

To help consumers stretch their dollars, stores are pushing sales and service.

The new 5,500-square-foot Sony store, which is set to open at the Annapolis mall Nov. 17, is promoting customer service with a concierge desk at the front of the store and assistance with Sony electronics.

"We have a very strong commitment to service," said Dennis Syracuse, senior vice president of Sony Retail for Sony Electronics. "We have helped people connect cables over the phone."

He added that the store will be promoting its Sweet 16 top picks this holiday season, including the No. 1 product, a new electronic reader with a touch-screen for $399 that comes with 100 free books as well as plenty of sales packages including a free Blu-ray player with any TV that costs $1500 or more, he said.

Scott deGraffenreid, mall marketing director, said the mall also will offer plenty of new stores and restaurant choices including the new Cheesecake Factory opening Dec. 4, he said.

"We're very unique in that we have so much more to offer, even compared to last year," he said. "We're expecting a healthy holiday season."

Donna De Garcia, owner of Blanca Flor Silver Jewelry stores at the mall and downtown Annapolis, said she didn't hold back on inventory, adding that she's stocked up pottery wood carvings, aluminum platters with bronze handles. Customers will also find plenty of triple-stone necklaces, silver earrings, hoops and bangles.

"I'm ready for big crowds," she said.

Catherine Incaprera, owner of Madison Boutique on Main Street, whose motto is "hip edgy and affordable" said she will offer plenty of party dresses and accessories and gifts including music and Dumpling Dynasty sewing boxes that actress Courtney Cox has bought for her children.

She said she also will have a line of pajamas by Free People that consumers can pick up for their girlfriend or wife.

"I don't have to change anything in regard to my store because the bulk of everything in my store is going to be under $60 - shoes, boots everything," said Ms. Incaprera, also a costume supervisor for major feature films.Lydia Briers, manager of Paradigm, a clothing shop on Main Street, said the store will still carry high-end lines such as French Connection, but also merchandise for those looking at prices more closely.

The store will carry some cashmere sweaters for $120 or less, Max & Cleo dresses for between $80 and $100 and staples such as jackets and long-sleeve tops, she said.

"We'll have a lot of gift items, some amazing clutches, some really fun makeup cases," she said. "If someone wanted to run in and out they could find something for $50 or even $25."

Ms. Briers said the store also is carrying dresses that can be worn to everything from cocktail parties to weddings and work.

"We're buying a lot smarter," she said. "We're trying to get a lot more bang for your buck."