A monthly measure of consumer confidence has declined for a second straight month as concerns mount over business and labor conditions.
The Conference Board reported that its Consumer Confidence Index (CCI) fell 3.9 points in July to 50.4. With losses in June and July, the index has dropped a total of more than 12 points since May.
“Concerns about business conditions and the labor market are casting a dark cloud over consumers that is not likely to lift until the job market improves,” said Lynn Franco, director of the Conference Board Consumer Research Center. “Given consumers’ heightened level of anxiety, along with their pessimistic income outlook and lackluster job growth, retailers are very likely to face a challenging back-to-school season.”
The Conference Board, a business research group, bases the CCI on the results of monthly surveys of 5,000 U.S. households. Economists closely monitor the index because consumer spending accounts for about two-thirds of economic activity in the country.
Consumer assessments of current business and labor conditions pushed the Present Situation Index down seven-tenths to 26.1.
The share of consumers responding to the survey upon which the July CCI was based who rated current business conditions as “good” rose six-tenths to 9 percent. But the proportion of those who said conditions are “bad” rose 2.6 points to 43.6 percent.
The share of consumers who said jobs are “plentiful” held steady at 4.3 percent, while the proportion of those who characterized jobs are “hard to get” rose 2.3 points to 45.8 percent.
The Expectations Index, a component of the CCI assessing consumer outlooks, fell more than six points to 66.6
The proportion of consumers who expect business conditions to improve over the next six months fell 1.2 points to 15.9 percent. The share of those who anticipate worsening conditions rose 1.8 points to 15.7 percent.
The proportion of consumers who expect more jobs to become available in the months ahead fell 1.9 points to 14.3 percent, while the share of those who anticipate fewer job openings rose a point to 21.1 percent.
The proportion of consumers who expect their incomes to increase slipped six-tenths to 10 percent.