NEW YORK - The consumer confidence index slipped to 47.7 in October from an upwardly revised 53.4 last month, The Conference Board reported this morning.
The September index was originally reported as 53.1.
Economists polled by Thomson Reuters predicted the index would rise to 53.5.
The present situation index fell to 20.7 from an upwardly revised 23.0, originally reported as 22.7, while the expectations index dipped to 65.7 from an upwardly revised 73.7 last month, originally seen as 73.3.
“Consumers’ assessment of present-day conditions has grown less favorable, with labor market conditions playing a major role in the grimmer assessment,” said Lynn Franco, director of The Conference Board's Consumer Research Center. “In fact, the present situation index is now at its lowest reading in 26 years (17.5 February 1983). The short-term outlook has also grown more negative, as a greater proportion of consumers anticipate business and labor market conditions will worsen in the months ahead. Consumers also remain quite pessimistic about their future earnings, a sentiment that will likely constrain spending during the holidays.”
Business conditions were called “good” by 7.7% of respondents in October, a decrease from 8.6% the prior month. Those saying conditions are “bad” grew to 47.1% from 46.3%.
The percentage of consumers expecting a pickup in business conditions in the next half year slid to 20.8% from 21.3%, while 18.3% said they expect conditions to worsen, up from 14.6% the prior month.
On the jobs front, those who believe jobs are “plentiful” decreased to 3.4% in October from 3.6% in September, while the number saying jobs are “hard to get” increased to 49.6% this survey from 47.0%. The respondents who see more jobs becoming available in a half year, dipped to 16.3% from 18.0%. Those expecting fewer jobs to become available rose to 26.6% from 22.9%, The Conference Board reported.
Income expectations were more pessimistic, with 10.3% of consumers anticipating an increase in their income in the next six months, down from the prior month's 11.2%, while 19.5% expect their income to decrease, up from 19.3% in the prior month’s survey.
The number of consumers who expected to buy a home in the next six months slipped to 2.3% from 2.5%, while the number of respondents planning to buy a car dipped to 4.4% from 4.5%. Fewer consumers said they plan to buy a major appliance in the next six months (23.3% vs. 24.5%).
Fewer respondents than last month (37.4% vs. 38.9%) expect to take a vacation in the next six months, but more said they would stay in the U.S. rather than leave the country. Cars rather than airplanes were the preferred mode of travel, by an 18.8%-15.2% margin.
The consumer confidence survey is based on a representative sample of 5,000 U.S. households for The Conference Board by TNS.
