Consumers Lose Confidence For Third Straight Month

Don Hogsett, November 1, 2004

Consumer confidence tumbled for a third straight month during October, and further than expected, as Americans continue to fret about employment issues and grow increasingly concerned about the economic outlook.

The bellwether gauge slipped 4 percent, to its lowest level since March, sliding to a level of 92.8 from 96.7 in September. Tripped up by gnawing concerns about the jobs outlook and a growing apprehension about the outlook six months out, the widely watched number came in lower than the 94 reading economists had been looking for.

Confidence levels are now down 12.1 percent from their 13-month high of 105.7 reached in June, and are at their lowest level since a reading of 88.5 in March.

“Subdued expectations, as opposed to eroding present-day conditions, were the major cause behind October's decline,” said Lynn Franco, director of The Conference Board's Consumer Research Center. “And while consumers' assessment of the labor market showed a moderate improvement, the gain was not sufficient to ease concerns about job growth in the months ahead.”

A sticking point with consumers is the economic outlook six months out, and Americans turned more cautious, the business think tank noted. The number of consumers expecting conditions to worsen increased to 10.3 percent from 9.4 a month ago.

Consumer confidence by region

Region % change
Source: The Conference Board
New England 10.0%
Middle Atlantic -13.7
East North Central 0.8
West North Central -2.9
South Atlantic 3.6
East South Central 20.8
West South Central -3.0
Mountain -4.2
Pacific -3.4

Consumer buying plans October
Plans to purchase over the next six months

Source: The Conference Board
Homes -10.3%
Carpets -7.5
Cars 17.5
Major appliances -9.1
Vacation 13.5

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