While attitudes about the current economy dropped slightly, consumers seem to think the future is brighter with the Expectations Index rising 6.7 points.

NEW YORK – The Conference Board Consumer Confidence Index increased again in December, after being revised upward for November. The Index now stands at 115.8, up from 111.9 in November.

The Present Situation Index – based on consumers’ assessment of current business and labor market conditions – was relatively flat at 144.1, down from 144.4 last month. The Expectations Index – based on consumers’ short-term outlook for income, business and labor market conditions – rose to 96.9 from 90.2.

“Consumer confidence improved further in December, following a very modest gain in November,” says Lynn Franco, senior director of economic indicators at The Conference Board. “The Present Situation Index dipped slightly but remains very high, suggesting the economy has maintained its momentum in the final month of 2021.”

According to Franco, the surge in the Expectations Index sets the “stage for continued growth in early 2022.” She says the numbers increased for the “proportion of consumers planning to purchase homes, automobiles, major appliances and vacations over the next six months.

“Meanwhile, concerns about inflation declined after hitting a 13-year high last month, as did concerns about COVID-19, despite reports of continued price increases and the emergence of the Omicron variant,” she adds. However, in 2022, “both confidence and consumer spending will continue to face headwinds from rising prices and an expected winter surge of the pandemic.”

Present situation

Current business conditions

• 19.9% said business conditions were “good,” up from 17.9%
• 26.8% said business conditions were “bad,” down from 27.3%

Assessment of the labor market

• 55.1% of consumers said jobs were “plentiful,” down from 55.5%; still a historically strong reading
• 12.5% of consumers said jobs are “hard to get,” up from 10.8%

Expectations six months from now

Short-term business conditions

• 26.7% of consumers expect business conditions to improve, up from 25.6%
• 17.9% expect business conditions to worsen, down from 19.6%

Short-term labor market

• 25.1% of consumers expect more jobs to be available in the months ahead, up from 22.8%
• 14.8% anticipate fewer jobs, down from 19.0%

Personal short-term financial prospects

• 18.0% of consumers expect their incomes to increase, down from 18.9%
• 11.5% expect their incomes to decrease, down slightly from 11.7%

 

 

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