Increasingly upbeat about improving business and labor conditions, consumers have pushed a monthly index tracking their confidence to its highest level in nearly seven years.
The Conference Board reported that its Consumer Confidence Index climbed 4.5 points to 90.9 in July. With increases in each of the last three months, the index has climbed to its highest level since it stood at 95.2 in October 2007. Readings for both current conditions and the short-term outlook increased in July.
“Strong job growth helped boost consumers’ assessment of current conditions, while brighter short-term outlooks for the economy and jobs, and to a lesser extent, personal income, drove the gain in expectations,” said Lynn Franco, director of economic indicators for the Conference Board. “Rising improvements in consumer confidence, in particular expectations, suggest the recent strengthening in growth is likely to continue into the second half of this year.”
The Conference Board, a business research and membership association, bases the index on the results of monthly surveys of U.S. households.
More optimistic appraisals of current conditions pushed up the present situation component of the index two points to 88.3.
The proportion of consumers responding to the survey upon which the July index was based who described business conditions as “good” slipped seven-tenths of a point to 22.7 percent. But the share of those who called conditions “bad” held steady at 22.7 percent.
The proportion of consumers who said jobs are “plentiful” climbed 1.3 points to 15.9 percent, while the share of those who said jobs remain “hard to get” was unchanged at 30.7 percent.
A more upbeat outlook also pushed up the expectations component of the index 6.3 points to 92.7.
The share of consumers who expect business conditions to improve over the next six months rose 1.8 points to 20.2 percent. The proportion of those expecting worsening conditions held steady at 11.5 percent.
The share of consumers who believe more jobs will become available increased 2.8 points to 19.1 percent. The proportion of those anticipating fewer jobs fell two points to 16.4 percent.
Slightly more consumers expect their incomes to increase — up six-tenths of a point to 17.3 percent.