Consumer Confidence Index climbs to five-year high

A monthly measure of consumer confidence has climbed to its highest level in five years on more upbeat assessments of business and labor conditions.

The Conference Board reported that its Consumer Confidence Index jumped more than seven points in May to 76.2. That’s the highest reading since the CCI stood at 76.4 in February 2008.

The CCI is based on the results of monthly surveys of U.S. households.

Economists closely monitor the index because consumer spending accounts for more than two-thirds of economic activity in the country.

“Consumers’ assessment of current business and labor market conditions was more positive. And they were considerably more upbeat about future economic and job prospects,” said Lynn Franco, director of economic indicators for the Conference Board,  a business research and membership group. “Back-to-back monthly gains suggest that consumer confidence is on the mend and may be regaining the traction it lost due to the fiscal cliff, payroll tax hike and sequester.”

Consumer appraisals of current conditions pushed up the present situation component of the CCI nearly six points to 66.7.

Consumers responding to the survey upon which the May CCI was based who described business conditions as “good” rose more than a point to 18.8 percent. The share of those who called business conditions “bad” fell nearly two points to 26 percent.

The proportion of consumers who described jobs as “plentiful” increase more than a point to 10.8 percent. The share of those who said jobs are “hard to get” fell almost a point to 36.1 percent.

The expectations component of the CCI advanced more than eight points to 82.4 in May on more upbeat outlooks for business and hiring.

The share of consumers who expect business conditions to improve over the next six months rose two points to 19.2 percent. The proportion of those who anticipate worsening conditions fell nearly three points to 12.1 percent.

The share of consumers who expect more jobs to become available in the months ahead increased 2.5 points to 16.8 percent. Meanwhile, the proportion of those who foresee fewer jobs fell more than two points to 19.7 percent.