Consumer confidence dipped in July as some cities and states experiencing eruptions in coronavirus infections suffered slowdowns in commerce, according to the Conference Board’s consumer confidence index.
“Large declines were experienced in Michigan, Florida, Texas, and California, no doubt a result of the resurgence of COVID-19,” said Lynn Franco, senior director of economic indicators at the Conference Board. “Looking ahead, consumers have grown less optimistic about the short-term outlook for the economy and labor market.”
The index for July was 92.6, down from 98.3 in June. Both of these numbers are compared to consumer confidence from 1985, which equaled 100, and denote that confidence is currently lacking regarding the strength of the economy.
Before the pandemic hit the United States, confidence was strong, according to the index. In January, it stood at 130.4, which indicated that respondents felt the economy was strong. The index ticked up to 132.6 in February but descended in March and April as the economy shut down to slow the spread of the virus. In June, as the economy started to reopen, it ticked up to 98.3.
July’s dip in confidence comes as roughly 17% of respondents currently deem the economy to be “good.” More than double that number, 39.1%, considered the economy to be “bad.”
Regarding employment, nearly 60% say jobs are currently “not so plentiful,” and 21.3% contend that there is an abundance of jobs.
Looking down the road, the number of consumers who expect that business conditions will improve over the next six months declined from 42.4% in June to 31.6% in July, while those expecting business conditions will worsen increased from 15.2% in June to 19.3% for July.
Consumers have also grown more pessimistic about job creation over the next six months. The proportion expecting more jobs in the months ahead declined from 38.4% in June to 30.6% in July, while those anticipating fewer jobs in the months ahead increased from 14.4% in June to 20.3% in July.
