It’s no secret that shoppers are cutting back this season and finding ways to stretch their holiday spending money a bit further. The National Retail Federation reports that consumer spending will be down 3.3% this year over last, yet there is one area of the retail space where shoppers are still spending: craft supplies.

“Most people find that making their own (gifts) is a great way to keep your costs in check,” said Leah Ingram, author of the “Suddenly Frugal: How to Live Happier and Healthier and Less.”

The trend towards crafting started last year, Ingram said, when money started to get tight for many families due to layoffs and tight credit markets. Since then, companies like craft retailers Michael’s and fabric stores like JoAnn Fabrics (JAF) and Hancock Fabrics have reaped the benefits of a creative resurgence.

During the third quarter alone, net sales were up by 6% at JoAnn Fabrics, where same-store sales rose 4.3%. At Hancock, net sales were up more than $2 million during the quarter, and same store sales saw a rise of 4%.

“There’s clearly a stronger interest in making gifts,” said Michael’s general manager of strategic marketing, John Rowe.

A survey of 1,000 Michael’s customers showed that 65% plan to make their holiday gifts this season. That’s up from 58% last year. The top crafts that Michael’s customers are making include baked goods, decorative candles, jewelry, and holiday cards, Rowe said.

Yet even those without solid crafting skills are finding ways to make their own presents this year. In Seattle, a neighborhood group called “Sustainable Green Lake” got together to pool its skills for making unique presents.

“We’ll all be learning and teaching a skill that we wouldn’t have when we walked through the door,” said Pennie O’Grady, one of the founders of Sustainable Green Lake. “This year we wanted to make presents, not just crafts.”

The group has around 12 members who shared their knowledge of how to make items, including candles, potholders, a clove orange and root beer. Each member brought enough supplies for 12 items, so each member left with a dozen unique presents. The gifts will be passed along to friends and family as gifts, and enjoyed at holiday celebrations, said O’Grady.

Groups like this are popping up all across the country, and gatherings of younger craft-savvy individuals, nicknamed “craft Mafia,” are going strong, according to Victor Domine, PR manager for the Craft and Hobby Association.

“There have been people getting together for centuries to make things, like quilting and scrap booking, but we’re really seeing a lot of indie urban craft makers in large cities,” said Domine. “They are reaping the social benefits of traditional crafting circles and having a great time.”

Around 43 million U.S. households will be creating hand-crafted gifts this holiday season, according to the Craft and Hobby Association, about the same number as last year. Since then, there has been a 5% increase in sales of sewing machines along with a 5% increase in fabric sales.

Domine highlighted the trends present in re-purposing items as consumers look to extend the shelf life and usefulness of their items to save money.

“Although the 'millennials' get a bad rap for spending too much money, you’ve got to hand it to them for their ability to upcycle their goods and get creative in edgy, unique ways,” he said.