The latest reading on consumer sentiment shows people are still extremely anxious about the economy, not a good sign for nervous retailers with the holiday season fast approaching.
Consumer confidence in November slightly rose to 49.5, according to the Conference Board, a private research group, which came in ahead of economists expectations. But NYT’s Catherine Rampell points out this confidence index has averaged about 95 during the last 30 years, showing a 49.5 reading is well-below the norm.
“The confidence numbers are largely reflecting the poor job market: Surveyed consumers who say that jobs are ‘plentiful’ fell to 3.2% in November, the lowest percentage this year,” Rampell notes.
With Black Friday only a few days away, retailers’ prospects for a successful holiday season remain grim. Consumers without jobs won’t be going on holiday spending sprees, and even folks who still work but are worried about job stability aren’t likely to go out and splurge for the holidays.
That’s not a good sign for retailers, especially as the unemployment rate at 10.2% and the under-employment rate sitting at 17.5%.
Financial Armageddon blogger Michael Panzner compiles a list of 10 holiday spending surveys, all of which portray the frugal consumer as a running theme.
Spending is expected to be down from a year earlier, Black Friday sales are forecasted lower, folks are likely to spend less on credit and more parents are expected to cut back on gifts for each other. That’s just a sampling of some of these survey’s results.
Of course, as Barry Ritholtz has noted in the past, individual holiday spending surveys need to be taken with a grain of salt. But when so many compiled together are portraying relatively the same theme, folks should take notice.
“If the following round-up of holiday spending surveys and news reports (with salient quotes) is anything to go by, those who have been counting on a V-shaped recovery in the (consumer-dependent) US economy might want to reconsider,” Panzner says.
