After a scary decline in October, U.S. consumer confidence jumped in November to its highest level since July. The Conference Board Consumer Confidence Index now stands at 56, up from 40.9 last month.
The Conference Board, an independent research association, compiles a survey of 3,000 households across the country that measures consumer attitudes on the economy. The Index is based on consumers' perceptions of current business and employment conditions, as well as their expectations for the next six months regarding business conditions, employment, and income. This month’s index was compiled before the congressional super committee announced it had failed to reach agreement on deficit reduction.
Though overall readings remain historically weak, noted Lynn Franco, director of the Consumer Research Center, in a statement, “Consumers appear to be entering the holiday season in better spirits.” Indeed, the survey follows reports of unprecedented sales over the year’s biggest shopping weekend that comprised Black Friday, Small Business Saturday and Cyber Monday. The holiday shopping season accounts for upwards of 40 percent of retailers’ annual revenue.
Other positive signs include jobless claims holding below 400,000 for three consecutive weeks as well as lower gas prices.
The Present Situation Index increased this month to 38.3 from 27.1. Just over 13 percent, up from 11.2 percent, stated that business conditions are “good.” Those stating business conditions are "bad" declined from 43.7 percent to 38.2 percent.
The Expectations Index rose to 67.8 from 50.0. The proportion of consumers anticipating business conditions to improve over the next six months increased to 13.6 percent from 10.2 percent, while those anticipating business conditions will worsen declined to 15.8 percent from 21.3 percent.
Though unemployment has been at around 9 percent for two years, consumers also took a more optimistic view of the job market. Those claiming jobs are "plentiful" increased to 5.8 percent from 3.6 percent, while those saying jobs are "hard to get" decreased to 42.1 percent from 46.9 percent. Those expecting more jobs in the months ahead rose to 12.9 percent from 10.8 percent, while those expecting fewer jobs decreased to 24.1 percent from 27.6 percent. The proportion of consumers anticipating an increase in their incomes rose to 14.9 percent from 11.1 percent.
The Conference Board index is in line with other recent sentiment surveys, Bloomberg reported. The Bloomberg Consumer Comfort Index’s monthly expectations gauge also climbed this month to its highest level since July, before the downgrade of the U.S. debt. The Thomson Reuters/University of Michigan final index of consumer expectations for the next six months rose this month to its highest level in five months.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.