Consumers expressed renewed confidence in the economy at the end of 2013, according to The Conference Board Consumer Confidence Index, which had decreased in November, but rebounded in December. The Index now stands at 78.1, up from 72.0 in November. The Present Situation Index increased to 76.2 from 73.5. The Expectations Index increased to 79.4 from 71.1 last month.
Lynn Franco, director of economic indicators at The Conference Board, said, “Consumer confidence rebounded in December and is now close to pre-government shutdown levels (September 2013, 80.2). Sentiment regarding current conditions increased to a 5.5 year high (April 2008, 81.9), with consumers attributing the improvement to more favorable economic and labor market conditions. Looking ahead, consumers expressed a greater degree of confidence in future economic and job prospects, but were moderately more pessimistic about their earning prospects. Despite the many challenges throughout 2013, consumers are in better spirits today than when the year began.”
Consumers’ appraisal of overall current conditions improved. Those claiming business conditions are “good” edged down to 19.6% from 20.4%; however, those claiming business conditions are “bad” decreased to 22.6% from 24.6%. Consumers’ appraisal of the job market was also more upbeat. Those saying jobs are “plentiful” ticked up to 12.2% from 12.0%, while those saying jobs are “hard to get” decreased to 32.5% from 34.1%.
Consumers’ expectations, which had decreased in November, improved in December. The percentage of consumers expecting business conditions to improve over the next six months increased to 17.2% from 16.7%, and those expecting business conditions to worsen decreased to 14.0% from 16.1%.
Consumers’ outlook for the labor market was considerably more optimistic. Those anticipating more jobs in the months ahead increased sharply to 17.1% from 13.1%, while those anticipating fewer jobs decreased to 19.0% from 21.4%. The proportion of consumers expecting their incomes to increase declined to 13.9% from 15.3%, while those expecting a decrease in their incomes declined to 14.0% from 15.5%.
The monthly Consumer Confidence Survey, based on a probability-design random sample, is conducted for The Conference Board by Nielsen, a leading global provider of information and analytics around what consumers buy and watch. The cutoff date for the preliminary results was December 17.