Consumer Confidence Index drops

A measure of consumer sentiment has dropped to its lowest level in six months on less upbeat assessments of business and labor conditions.

The Conference Board reported its Consumer Confidence Index fell 11.3 points to 113.8 in August. That’s the lowest point since the index stood at 95.2 in February.

“Concerns about the Delta variant and, to a lesser degree, rising gas and food prices resulted in a less favorable view of current economic conditions and short-term growth prospects,” said Lynn Franco, senior director of economic indicators at the Conference Board.

“While the resurgence of COVID-19 and inflation concerns have dampened confidence, it is too soon to conclude this decline will result in consumers significantly curtailing their spending in the months ahead,” Franco said.

The business research and membership group bases the index on the results of monthly household surveys. Consumer spending accounts for more than two-thirds of economic activity.

Less upbeat assessments of current conditions pulled down the present situation component of the index 9.9 points to 147.3.

The proportion of consumers responding to the survey upon which the August index was based who described business conditions as “good” declined 4.7 points to 19.9 percent. The share of those who characterized conditions as “bad” advanced four points to 24 percent. 

The proportion of consumers who called jobs “plentiful” fell six-tenths of a point to 54.6 percent. The share of those who said jobs are “hard to get” rose seven-tenths of a point to 11.8 percent.

Less upbeat outlooks pulled down the expectations component of the index 12.4 points to 91.4.

The share of consumers who said they expect business conditions to improve over the next six months fell eight points to 22.9 percent. The proportion of those predicting worsening conditions rose 5.9 points to 17.8 percent.

The share of consumers who expect more jobs to become available in coming months decreased 2.5 points to 23 percent. The share of those anticipating fewer jobs increased eight-tenths of a point to 18.6 percent.