Consumer confidence falls again in November

Rising gas prices took a bite out of consumer confidence in November.

The Conference Board’s Consumer Confidence Index fell to 100.2 in November — its lowest level since July — from 102.2 in October. It was the second consecutive month the index has fallen. 

"Consumer confidence declined again in November, most likely prompted by the recent rise in gas prices," said Lynn Franco, senior director of economic indicators at The Conference Board. (Gas prices have since reversed and fell to $3.52 a gallon, on average, nationwide on Tuesday, according to AAA, down from $3.76 a month ago.)

Despite the pessimistic outlook, Americans are still spending. Record crowds turned out to shop over the long Thanksgiving weekend. And online shoppers spent more money on Cyber Monday than on any single day – ever.

The Present Situation Index—based on consumers' assessment of current business and labor market conditions—decreased to 137.4 in November from 138.7 last month. The Expectations Index—based on consumers' short-term outlook for income, business, and labor market conditions—declined to 75.4 from 77.9.

“The Present Situation Index moderated further and continues to suggest the economy has lost momentum as the year winds down,” Franco said. “Consumers' expectations regarding the short-term outlook remained gloomy. Indeed, the Expectations Index is below a reading of 80, which suggests the likelihood of a recession remains elevated."

In other November results, inflation expectations increased to their highest level since July, with both gas and food prices as the main culprits. Intentions to purchase homes, automobiles, and big-ticket appliances all cooled.

“The combination of inflation and interest rate hikes will continue to pose challenges to confidence and economic growth into early 2023,” Franco added.

Here are more findings from the November report.

Present Situation

Consumers' assessment of current business conditions was mixed in November.

• 18.2% of consumers said business conditions were "good," up from 17.7%.
• On the other hand, more consumers, 26.7%, said business conditions were "bad," up from 24.0%.

Consumers' appraisal of the labor market was somewhat more favorable.

• 45.8% of consumers said jobs were "plentiful," up from 44.8%.
• 13.0% of consumers said jobs were "hard to get," unchanged from last month.

Expectations Six Months Out

Consumers remain pessimistic about the short-term business conditions outlook in November.

• 19.9% of consumers expect business conditions to improve, up slightly from 19.6%.
• 22.7% expect business conditions to worsen, down from 24.3%.

Consumers were more downbeat about the short-term labor market outlook.

• 18.6% of consumers expect more jobs to be available, down from 19.5%.
• 21.4% anticipate fewer jobs, up from 20.8%.

Consumers were also more pessimistic about their short-term income prospects.

• 17.2% of consumers expect their incomes to increase, down from 19.6%.
• 16.6% expect their incomes will decrease, up from 15.2%.

The monthly Consumer Confidence Survey, based on an online sample, is conducted for The Conference Board by Toluna, a technology company that delivers real-time consumer insights and market research through its innovative technology, expertise, and panel of over 36 million consumers. The cutoff date for the preliminary results was November 18.