A monthly measure of confidence has climbed to its highest level in more than 17 years on more upbeat assessments of business and labor conditions.
The Conference Board reported its Consumer Confidence Index rose 6.5 points to 130.8 in February with increases in components tracking assessments of current conditions and expectations for the near future. The index stands at its highest level since a reading of 132.6 in November 2000.
“Consumers’ assessment of current conditions was more favorable this month, with the labor force the main driver,” said Lynn Franco, director of economic indicators for the Conference Board. “Despite the recent stock market volatility, consumers expressed greater optimism about short-term prospects for business and labor market conditions as well as their financial prospects. Overall, consumers remain quite confidence that the economy will continue expanding at a strong pace in the months ahead.”
The business research and membership association bases the Consumer Confidence Index on monthly household surveys. Economists closely monitor the results because consumer spending accounts for more than two-thirds of economic activity.
For February, the present situation component of the index increased 7.7 points to 162.4.
The proportion of consumers responding to the survey upon which the index was based who described business conditions as “good” rose eight-tenths of a point to 35.8 percent. The share of consumers who called business conditions “bad” fell 2.2 points to 10.8 percent.
The proportion of consumers who characterized jobs as “plentiful” advanced 2.2 points to 39.4 percent. The share of those who said jobs are “hard to get” retreated 1.6 points to 14.7 percent.
The expectations component of the Consumer Confidence Index rose 5.7 points to 109.7.
The share of consumers who said they expect business conditions to improve over the next six months rose 4.3 points to 25.8 percent. The proportion of those anticipating worsening conditions edged down four-tenths of a point to 9.4 percent.
The share of consumers who expect more jobs to become available in coming months increased 2.9 points to 21.6 percent. The proportion of those anticipating fewer jobs slipped six-tenths of a point to 11.9 percent.
Meanwhile, 23.8 percent of consumers said they expect their incomes to increase, up 3.2 points. Another 8.6 percent of consumers said they anticipate earning less, up seven-tenths of a point.