Consumer Confidence Drops in February

   

Posted: Mar 12, 2010

Reduced spending and anxiety over the job market may have contributed to a drop in consumer confidence in February, according to the Conference Board Consumer Research Center.

The recently released Consumer Confidence Index showed that current and six-month outlooks on the economy both decreased in February. The Index fell from 56.5 to 46, while the Expectations Index decreased 77.3 to 63.8. The scores are measured on a scale of 100.

Respondents were more pessimistic about the labor market than in previous months, with 47.7 percent saying jobs were "hard to get," up from 46.5 percent in January. Lynn Franco, director of the research center, said business conditions may have pushed the Situation Index to its lowest level since 1983.

"Consumers also remain extremely pessimistic about their income prospects. This combination of earnings and job anxieties is likely to continue to curb spending," Franco said.

Spending is often seen as a major factor in recovering from a recession. Retail sales grew by 0.5 percent in January, according to a report from the U.S. Census Bureau, and were propelled by sales at general-merchandise stores and non-store retailers. This represented a 4.7-percent increase compared to January 2009.