Consumer Report: Economy making unsteady progress

Yonkers, N.Y. A consumer report released Tuesday found that slow job creation and continued consumer troubles are causing Americans to act cautiously.

The Consumer Reports Employment Index is down to 50.2 in August, compared with 51.1 in July. The overall labor force activity has slowed considerably in the past month with significantly fewer Americans claiming to have started a new job in the past 30-days -- 5.9% versus 7.8% the prior month.

While the Consumer Reports Trouble Tracker Index declined this month to 56.6 from 57.6 the prior month, and is down from its recent high in June (63.5), as well as from a year ago (61.7), the overall specific improvement over the past 30 days were small, according to the Consumer Reports Index. The positive developments for Americans included: a decline in missed mortgage payments to 2.4% from 3.9% in June, and a drop in the proportion of Americans' homes entering foreclosure -- 0.6% following two months of increases.

According to the report, healthcare coverage continues to be problematic. Nearly one-in-10 (9.7%) reported reduced coverage, up from the prior month (8.9%) and at its highest level recorded since April 2009.

The Consumer Reports' Sentiment Index is unchanged for August at 44.7 versus 45.2 in July. It has changed little since October 2009, when it stood at 42.1, and has not entered positive territory since it was first measured in October 2008.

"This is a recovery at risk," said Ed Farrell, a director of the Consumer Reports National Research Center. "There are several factors fueling this uncertainty, including job creation, which remains anemic along with consumers' sentiment, which has held steady in negative territory for two years reflecting that Americans have not seen any real improvement in their financial situations since we entered this recession."

However, the Consumer Reports Retail Index for August, reflective of July activity, is at 11.4 -- its highest level since the holiday season. The Past 30-Day Retail Index is up from the prior month (10.4) and from one year ago (9.5). Per capita spending for the past 30-days was up slightly for August, reflecting July activity, to $286, from July's $274 -- capping three periods of steady growth.

The proportion of Americans buying across categories in the past 30 days showed that the largest gains were posted by personal electronics (24.9% up from 22.5%); small appliances (20.3% up from 17.4%); major home electronics (12.7% up from 10.8).

The Consumer Reports Index, conducted by the Consumer Reports National Research Center, is a monthly telephone and cell phone poll. A total of 1,259 interviews were completed between July 29 and Aug.1.