GAINESVILLE – The consumer confidence index among Floridians remained at 65 in November, a ranking that matches a revised mark set in October and is only six points higher than the record low of 59 set in June 2008.
The index used by UF researchers is benchmarked to 1966, which means a value of 100 represents the same level of confidence for that year. The lowest index possible is a 2; the highest is 150.
The November survey reveals a mixture of positive and negative perceptions.
“Consumers are slightly less optimistic about current conditions than they were last month and slightly more optimistic about long run conditions,” said Chris McCarty, director of UF’s Survey Research Center in the Bureau of Economic and Business Research, which conducted the survey.
McCarty noted that of the five categories used to measure consumer confidence, two decreased, two increased and one remained unchanged, resulting in an overall mark of 65. Perceptions, for example, that compare personal finance levels with those of a year ago fell two points to 52. However, expectations that personal finances will improve a year from now went up three points to 79.
Meanwhile, respondents’ overall view that the U.S. economy will improve over the coming year fell two points to 52. However, their expectation that the economy will improve over the next five years remained unchanged at 67.
Finally, the perception that now is a good time to buy big-ticket consumer items, such as televisions and laptop computers, rose four points to 75.
Sources for optimism, however, don’t necessarily indicate a recovery is on the way. Most of the index components, for instance, are lower than they were at the same time a year before. Not only is the consumer confidence level stuck at historically low levels, it “has previously been associated with recessionary levels,” said McCarty.
If consumer confidence attitudes are mixed, so, too, are reports of economic activity. The jobless rate for Florida, for example, remains high at 10.3 percent, though there was an encouraging three-tenths of a percent decline in unemployment from September to October. Some of the new hiring occurred in the health and education sectors. An uptick in Florida tourism also spurred job creation in the leisure and hospitality sectors. However, McCarty said sustained increases in tourism may fade if austerity programs in Europe and the U.S. curtail personal spending on travel.
Meanwhile, Florida’s consumer confidence continues to be shaken by a slump in housing activity. The median price for a single-family home at $131,550 is down from both September and October of last year.
The gloomy housing outlook is accompanied by modest good news of gasoline prices, which command a larger share of lower income consumers' spending. They dropped 7 cents in November from the previous month to $3.35 for a gallon of regular gas.
McCarty also anticipated a future with mixed prospects.
“The Gross Domestic Product (the nation’s annual product and an indicator of economic health), though revised downward for the third quarter, was still positive at 2 percent nationally,” he said. “Florida's gross state product is forecast to be low, but positive.”
McCarty added that although the U.S. and Florida may avoid experiencing the effects of negative GDP, most economic indicators “suggest sluggish growth for the next few quarters.” In addition, he said that worsening economic problems in Europe may drag the U.S. into a lower GDP.
Even though retail sales were down in October and consumer confidence levels are low, McCarthy predicted modest growth this holiday season compared with 2010.
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