"Consumer confidence has been challenged several times over the past few months...it is too soon to tell if confidence is actually on the mend."
Consumer confidence rebounded in April after declining in March, according to the Conference Board Consumer Confidence Index, which now stands at 68.1, up from 61.9 the previous month.
The Present Situation Index increased from 59.2 in March to 60.4 in April, while the Expectations Index improved from 63.7 to 73.3
The Index is based on a survey of 3,000 households across the country. Consumers are polled about their perceptions of current business and employment conditions as well as their expectations regarding business conditions, employment and income for the next six months. Consume confidence is seen as a driver of consumer spending, which accounts for 70 percent of the economy.
“Consumer confidence has been challenged several times over the past few months by such events as the fiscal cliff, the payroll tax hike and the sequester,” noted Lynn Franco, Director of Economic Indicators a The Conference Board, in a statement. “Thus, while expectations appear to have bounced back, it is too soon to tell if confidence is actually on the mend.”
Consumer confidence in current business conditions improved moderately in April. Those saying business conditions are “good” increased from 16.4 percent to 17.2 percent, while those saying they were “bad” decreased from 29.1 to 28.1.
Consumers’ assessment of the labor market was more mixed, the Conference Board reported. Those claiming jobs are “plentiful” ticked upward from 9.5 percent to 9.8 percent, but those claiming jobs are “hard to get” increased from 35.4 percent to 37.1 percent.
Consumers were considerably more optimistic about the short-term outlook. The percentage of consumers expecting business conditions to improve over the next six months increased from 15 percent to 16.9, while those anticipating business conditions to worsen decreased from 17.7 percent to 15.1 percent.
Consumer confidence in the labor market was also more positive. Those expecting more jobs in the months ahead improved from 13 percent to 14.2, while those expecting fewer jobs decreased from 16 percent to 22.4 percent. The proportion of consumers expecting their incomes to increase rose from 14.6 percent to 16.8, while those expecting a decrease declined from 17.7 percent to 16.0 percent.
Related story: Affluent Household Outlook Gains Amidst Concerns Over Economy, Household Income. Read it here.
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.