A monthly measure of consumer confidence has seesawed down as uncertainty over the effects of government spending cuts cloud the outlook for business and labor conditions.
The Conference Board reported that its Consumer Confidence Index (CCI) fell more than eight points to 59.7 in March.
The CCI has had its ups and downs over the past three months with a more than 11-point gain in February and an eight-point drop in January.
“This month’s retreat was driven primarily by a sharp decline in expectations, although consumers were also more pessimistic in their assessment of current conditions,” said Lynn Franco, director of economic indicators at the Conference Board. “The loss of confidence, particularly expectations, mirrors the losses experienced this past December and January. The recent sequester has created uncertainty regarding the economic outlook and as a result, consumers are less confident.”
The Conference Board, a business research and membership group, bases the CCI on the results of monthly surveys of U.S. households.
Economists closely monitor the index because consumer spending accounts for about two-thirds of economic activity in the country.
For March, less upbeat assessments of current business and labor conditions pushed the present situation component of the CCI down 3.5 points to 57.9.
The proportion of consumers who called business conditions “good” fell 1.6 points to 16 percent. The share of those who called business conditions “bad” rose more than a point to 29.3 percent.
Meanwhile, 9.4 percent of consumers said jobs were “plentiful,” down seven-tenths of a point. But 36.2 percent of consumers said jobs were “hard to get,” also down seven-tenths of a point.
A more pessimistic outlook pulled the expectations component of the CCI down 11.5 points to 60.9 in March.
The share of consumers who said they expect business conditions to improve over the next six months fell 3.6 points to 14.4 percent. The proportion of those who said they expect conditions to worsen rose 1.7 points to 18.3 percent.
Meanwhile, 12.3 percent of consumers said they expect more jobs to become available in the months ahead, down 3.8 points. And 26.6 percent said they expect fewer jobs, up 4.5 points.
The proportion of consumers who expect their incomes to increase fell 2.1 points to 13.7 percent. The share of those who anticipate less income fell 1.3 points to 18 percent.