Consumer confidence ticks up in June; labor market concerns rise
Americans’ outlook about the economy improved somewhat in June as moderating gas prices brought some relief to inflation-weary consumers.
The Conference Board Consumer Confidence Index ticked up by 0.6 points to 91.2, in June, up from a downwardly revised 90.6 in May but below its year-ago reading of 95.2. (The survey period for this month’s preliminary results was June 1 – 23, encompassing an extension of the U.S.-Iran ceasefire agreement.)
The Expectations Index — based on consumers’ short-term outlook for income, business, and labor market conditions—rose by 3.0 points to 74.4. But the Present Situation Index — based on consumers’ assessment of current business and labor market conditions — fell by 3.0 points to 116.4
“Consumer confidence inched up in June as falling oil prices in recent weeks provided some relief to consumer inflation fears,” said Dana M Peterson, chief economist, The Conference Board.
Perceptions of the current labor market softened measurably in June as the percentage of consumers saying jobs were ‘hard to get’ rose to 22.5%, the highest level since January 2021 (22.8%).
“Moreover, consumers anticipate little change in the labor market six months from now,” added Peterson. “This was offset by improving expectations for business conditions and incomes.”
Buying Intentions
Consumers’ plans to buy big-ticket items over the next six months improved slightly, shifting from “no” to “maybe”, and the proportion saying “yes” picked up modestly. Buying plans for autos continued rising on a six-month moving average basis in June.
Home buying expectations also rose on a six-month rolling basis. Consumers planning purchases six months ahead continued to rank furniture followed by smartphones as the most desired items, but expectations for both categories moderated further in June.
Spending plans for white goods and electronics eased a tad or were relatively unchanged on a six-month moving average basis.
Consumers planning more spending on services over the next six months shifted from “no” to “maybe” in June, but future spending plans on individual services were mixed. Among all service categories, restaurants/bars/take-out, streaming/internet/mobile services, and beauty and personal care, remained among the top three spending targets.
Below are additional insights from the June report.
Present Situation
Consumers’ views of current business conditions improved in June.
- 20.0% of consumers said business conditions were “good,” up from 19.2% in May.
- 16.5% said business conditions were “bad,” down from 16.7%.
On net, consumers’ views of the labor market worsened in June.
- 24.9% of consumers said jobs were “plentiful,” up slightly from 24.8% in May.
- Conversely, 22.5% of consumers said jobs were “hard to get,” up from 19.8%.
Expectations Six Months Hence
Consumers were more optimistic about future business conditions in June.
- 19.0% of consumers expected business conditions to improve, up from 18.8% in May.
- 20.3% expected business conditions to worsen, down from 23.2%.
On net, consumers’ negative stance about the labor market outlook was largely unchanged in June.
- 15.2% of consumers expected more jobs to be available, down from 16.6% in May.
- However, 25.6% anticipated fewer jobs, down from 27.0%.
The monthly Consumer Confidence Survey, based on an online sample, is conducted for The Conference Board by Toluna. The cutoff date for the preliminary results was June 23.
