A monthly measure of consumer confidence has rebounded sharply on more upbeat assessments of business and labor conditions.
The Conference Board reported that its Consumer Confidence Index surged more than 11 points to 69.6 in February. The gain follows a more than eight-point drop the month before. At this time last year, the index stood at 71.6.
“Consumer confidence rebounded in February as the shock effect caused by the fiscal cliff uncertainty and payroll tax cuts appears to have abated,” said Lynn Franco, director of economic indicators for the Conference Board.
“Consumers’ assessment of current business and labor market conditions is more positive than last month. Looking ahead, consumers are cautiously optimistic about the outlook for business and labor conditions. Income expectations, which had turned rather negative last month, have improved modestly,” Franco added.
The Conference Board, a business research and membership group, bases the CCI on the results of monthly household surveys. Economists closely monitor the index because consumer spending accounts for two-thirds of all economic activity in the country.
Consumer assessments of current business and labor conditions pushed the present situation component of the index up more than seven points to 63.3.
The proportion of consumers responding to the survey upon which the February CCI was based who called business conditions “good” rose two points to 18.1 percent. The share of those who said conditions were “bad” fell six-tenths of a point to 27.8. percent.
The proportion of consumers who said jobs were “plentiful” advanced two points to 10.5 percent. But the share of those who characterized jobs as “hard to get” rose four-tenths of a point to 37 percent.
Consumers also were more optimistic in their short-term outlooks, pushing up the expectations component of the index almost 14 points to 73.8.
The share of consumers who expect business conditions to improve over the next six months increased more than three points to 18.9 percent. The proportion of those who anticipate worsening conditions decreased almost four points to 16.5 percent.
The share of consumers who believe more jobs will become available climbed more than two points to 16.7 percent. The proportion of those who expect fewer job openings in the months ahead fell more than five points to 21.5 percent.
Meanwhile, 15.7 percent of consumers responding to the survey expect their incomes to increase, up more than two points from last month.
Another 19.6 percent of consumers anticipate less income, down almost four points from a month ago.