Consumer confidence surged in September, according to new data from The Conference Board. Specifically, the headline sentiment index jumped to 138.4 this month, the highest reading in 18 years and significantly better than anticipated. Americans’ opinions of both current and future economic conditions improved this month, but the gap between the two gauges has been widening and now hovers at a level often seen prior to a recession. This does not mean that an economic downturn is imminent, but it should serve as another reminder that the current expansion in the United States is already one of the longest in history, and a recession in the next 5-10 years would therefore not be too surprising.
Helping delay that inevitable economic slowdown will be a strong consumer, and encouragingly the proportion of surveyed Americans expecting more job openings in the months ahead increased to 22.5 percent in September. In fact, the differential between the percentage of respondents saying that jobs are “plentiful” and those saying jobs are “hard to get” increased for the third month in a row in September to the widest gap since 2001. Moreover, 22.6 percent of consumers in September said that they expect their income will improve in the months ahead, while just 6.5 percent anticipate a pay cut. Lynn Franco, Director of Economic Indicators at The Conference Board, added that “These historically high confidence levels should continue to support healthy consumer spending, and should be welcome news for retailers as they begin gearing up for the holiday season.”
Sources: Econoday, The Conference Board, ZH, Bloomberg
Post author: Charles Couch