Consumer confidence takes dive after three months of gains
June survey finds consumers worried about slowing job growth
Furniture Today Staff -- Furniture Today, June 29, 2010
NEW YORK — The Consumer Confidence Index fell sharply in June to 52.9, down from 62.7 in May (1985=100), losing traction after three consecutive months of gains.
The Present Situation Index decreased to 25.5 from 29.8, while the Expectations Index sank to 71.2 from 84.6 last month.
"Increasing uncertainty and apprehension about the future state of the economy and labor market, no doubt a result of the recent slowdown in job growth, are the primary reasons for the sharp reversal in confidence," said Lynn Franco, director of The Conference Board Consumer Research Center. "Until the pace of job growth picks up, consumer confidence is not likely to pick up."
The Index is based on a survey of a representative sample of 5,000 U.S. households by the research firm TNS. The cutoff date for June's preliminary results was June 22.
Consumers' appraisal of present-day conditions was less favorable in June. Those saying conditions are "good" decreased to 8% from 9.7%, while those saying business conditions are "bad" increased to 42.4% from 39.5%.
Consumers' assessment of the labor market also was less favorable. Those claiming jobs are "hard to get" increased to 44.8% from 43.9%, while those saying jobs are "plentiful" decreased to 4.3% from 4.6%.
Consumers' short-term outlook, which had improved significantly last month, turned more pessimistic in June. Those anticipating an improvement in business conditions over the next six months decreased to 17.2% from 22.8%, while those expecting conditions will worsen rose to 14.9% from 11.9%.
Consumers also were much less optimistic about future job prospects. The percentage of consumers anticipating more jobs in the months ahead decreased to 16% from 20.2% in May, while those anticipating fewer jobs increased to 20.8% from 17.8%. The proportion of consumers anticipating an increase in their incomes declined to 10.6% from 11.4%.
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