Consumer confidence climbs 5 percent

Don Hogsett, May 3, 2004

With rank-and-file Americans feeling better about the jobs outlook and the state of the domestic economy, consumer confidence climbed 5 percent during April after running in place in March, The Conference Board reported.

The Consumer Confidence Index, seen as a barometer of future consumer spending — the principal driver of the economy — advanced to a reading of 93.9 (1985=100) from 88.5 in March.

"This latest improvement ... was sparked by a more favorable assessment of current business and labor market conditions and increased consumer optimism about the next six months," said Lynn Franco, director of The Conference Board's Consumer Research Center.

Consumers report they're feeling better about the jobs outlook, sparking a further recovery in confidence levels. Fears over the labor market have reined in confidence levels and kept consumers biting their nails even after the broad economy emerged from a recession.

"The job market, which has a major impact on confidence, appears to be gaining strength," said Franco. "The percentage of consumers claiming jobs are hard to get is now at its lowest level since November 2002, and more consumers expect this trend to continue."

Assaying the current economic outlook, 21.4 percent of consumers said business conditions have improved, up from 20.7 percent the prior month. Correspondingly, the number claiming conditions have worsened declined to 22 percent from 23.1 percent.

Peering into the crystal ball, consumers said they're feeling better about the future as well, and their outlook for the next six months improved for the first time this year.

Consumer confidence by region

New England 5.0%
Middle Atlantic 23.6
East North Central 3.6
West North Central 11.6
South Atlantic -1.3
East South Central -4.6
West South Central 7.5
Mountain -0.6
Pacific -1.8

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

Homes -16.7%
Carpets -7.7
Cars 18.5
Major appliances 5.5
Vacation -1.4
Source: The Conference Board

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