Dive Brief:
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The Conference Board, a U.S.-based, nonpartisan non-profit business research organization, said Tuesday that its consumer confidence index has improved moderately in January, according to its monthly report with measurements by Neilsen.
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The boost was flatter than that the organization measured in December, with the index now at 98.1 compared to 96.3 last month. The cutoff date for the measurements was Jan. 14, so the index, which found that Americans don’t think stock market volatility will effect the economy, hasn’t yet taken into account the downturn markets in the last week or so.
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In general, the percentage of American consumers saying business conditions are “good” stayed flat from December, though the percentage saying conditions are “bad” declined slightly. Attitude about the labor market was more positive, with the percentage of those saying jobs are “plentiful” down from 24.2% to 22.8%, but those saying jobs are “hard to find” also declining to 23.4% from 24.5%.
Dive Insight:
The Conference Board’s January report, though just one month, had enough contradictions in it to indicate that consumers’ iffy attitudes toward the U.S. economy are apparently continuing on into 2016.
Those saying there will be more jobs in coming months rose from 12.4% to 13.2%, and those saying there will be fewer jobs decreased from 16.8 % to 16.5%. Perhaps most important, the proportion of consumers expecting incomes to rise increased from 16.3% to 18.1%. Those expecting an income decrease rose from 9.5% to 10.8%.
“Consumer confidence improved slightly in January, following an increase in December,” said Lynn Franco, Director of Economic Indicators at The Conference Board. “Consumers’ assessment of current conditions held steady, while their expectations for the next six months improved moderately. For now, consumers do not foresee the volatility in financial markets as having a negative impact on the economy.”
Even that last assessment could change, considering that global markets, including Wall Street, have been in turmoil in the weeks since the Board’s measures were taken. Still, Derek Lindsey, economist at BNP Paribas, said in a research note that the level of confidence is surprising, according to the Associated Press.
"The increase is rather surprising given the volatility in equities in the month," Lindsey wrote. "A resilient labor market and low gasoline and utilities prices seem to have offset any negative sentiment stemming from financial markets."
Still, overall, as the country has emerged from the 2008 Great Recession with employment finally rising in recent quarters, wages rising somewhat in some sectors, and fuel prices plummeting, American consumers have remained wary of spending.
That has been a challenge for retailers, which must confront changing tastes and priorities even as they boost spending on their own employment approaches and wages.
