Confidence sags amid job worries

Don Hogsett, March 1, 2004

Plagued by anxiety about a weak job market, Americans grew more wary about the economy during February, their confidence plunging to its lowest level since last October, The Conference Board reported.

The widely watched Consumer Confidence Index, seen as a harbinger of future spending plans, dropped by 9.4 percent last month to a reading of 87.3. That figure was down from a revised reading of 96.4 in January when the index reached its highest point in more than a year. Confidence levels retreated in every region of the nation, according to the business think tank.

"Consumers began the year on a high note, but their optimism has quickly given way to caution," said Lynn Franco, director of The Conference Board's Consumer Research Center. "Consumers remain disheartened with current economic conditions, and at the core of their disenchantment is the labor market."

Franco added, "While the current expansion has generated jobs over the past several months, the pace of creation remains too tepid to generate a sustainable turnaround in consumers' confidence. And, with consumers anticipating economic conditions to remain about the same in the months ahead, their short-term outlook turned less optimistic."

Americans' feelings about the job market soured considerably during February, and the number of consumers who anticipate more jobs to become available in the next six months fell to 18.7 percent from 22 percent in January. The number who expected fewer jobs to become available jumped correspondingly to 18.1 percent from 15 percent a month ago.

Consumer confidence by region

Region % change
New England -15.2%
Middle Atlantic -12.6
East North Central -13.3
West North Central -4.4
South Atlantic -4.5
East South Central -9.5
West South Central -14.4
Mountain -13.1
Pacific -2.9

Consumer Buying Plans — February
plans to purchase over the next six months

Source: The Conference Board
Homes +3.0%
Carpets -6.3
Cars -3.1
Major appliances -9.5
Vacation +17.4

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