Consumer Confidence Index Declines Again In October

The Conference Board’s Consumer Confidence Index, which had plummeted in September, declined again in October. The Index now stands at 85.0 (1985=100), down from 87.5 in September. The Present Situation Index declined to 108.2 from 110.4. The Expectations Index fell to 69.5 from 72.3 last month.

“Much of the decline in confidence over the past two months can be attributed to the recent hurricanes, pump shock and a weakening labor market,” said Lynn Franco, director of The Conference Board’s Consumer Research Center. “Consumers’ assessment of current conditions, however, remains above readings a year ago, but their short-term expectations are significantly below last October’s level. This degree of pessimism, in conjunction with the anticipation of much higher home heating bills this winter, may take some cheer out of the upcoming holiday season. In order to avoid a blue Christmas, retailers will need to lure shoppers with sales and discounts.”

Consumers’ overall assessment of ongoing conditions was less positive in October. Those claiming business conditions are “good’ decreased to 23.8 percent from 25.2 percent. Those claiming conditions are “bad” increased to 17.7 percent from 15.1 percent.

The employment picture was also less upbeat. Consumers saying jobs are “hard to get” increased to 25.4 percent from 23.1 percent, while those claiming jobs are “plentiful” rose to 20.1 percent from 23.6 percent.

For the first time since October 2001, consumers claiming jobs are plentiful outnumber those claiming jobs are hard to get.