February’s consumer confidence index reached its highest level in a year (70.8 compared to 72 in February 2011). That’s still considerably lower than the 107.2 it posted in February 2007. Nonetheless, consumer confidence has been improving over the past few months—and any good news is welcomed right now.
Consumers also appear to be a bit less pessimistic about both current and short-term economic conditions.
- 13% believe that current conditions are good (virtually unchanged since January), but those who think current conditions are poor dropped from 38.3% to 31.2%
- 18.7% believe things will improve over the next six months (up from 16.7% in January), while those who think things will get worse dropped from 14.6% to 11.8%
Consumers are feeling a bit better about the job market too. This is important because jobs must be the primary catalyst behind a sustained housing recovery.
- While few people (6% or so) believe that a job is easy to get these days, the number that believe a job is hard to get is starting to drop (down from 43.3% to 38.7%)
- The percentage of people that think the number of available jobs will continue to grow is now comparable to the percentage that think it will shrink. In fact, slightly more people (18.7%) think jobs will grow, as opposed to the 16.9% that think jobs will shrink.
When I read data like this, I think of a couple of things. First, we’ve seen positive news like this before. Whether or not this uptick in consumer confidence has any real staying power remains to be seen. High gas prices again this spring will certainly put it to the test. Secondly, most people are “somewhere in the middle”; they don’t necessarily think things are good, but they don’t necessarily think they are bad either, for example.
My mom said something funny/interesting last weekend. She and my dad made a trip to a nearby outlet mall. The place was really buzzing. “People weren’t just shopping around, they were buying stuff, lots of stuff,” my mom said, adding, “I thought things were so bad and people didn’t have any money?”
For the millions who remain un- or under-employed, things are pretty bad—and that is sad and unfortunate. But there are also millions of people who are doing OK, and we’re not just talking about the vilified one-percenters. It’s important to remember that as we enter what will likely prove to be another up-and-down season. Stay positive!