Consumers In Better Holiday Spirits

November 4, 2014

U.S. households plan to spend an average of $538 on gifts this holiday season, up slightly from $528 last year, The Conference Board reports today.  About 8 percent of consumers say they plan to spend more this year on holiday gifts, while approximately 32 percent plan to spend less.  The remaining 60 percent plan to spend the same as last year.

"The recent improvements in consumer confidence - along with robust job growth and declines in gas prices - have consumers approaching the holiday season in better spirits than last year," said Lynn Franco, Director of Economic Indicators at The Conference Board.  "However, despite the improved holiday cheer, consumers will once again seek out bargains and incentives when making their purchases."

About one in three holiday shoppers say they expect over half of their purchases to be on sale or discounted.  An increasing number of consumers will be clicking and shipping.  Nearly seven out of ten expect to purchase at least some of their holiday gifts online, while about one out of four say more than half of their gifts will be purchased online.

Source: The Conference Board

Consumer Confidence Declines Again in November

The Conference Board Consumer Confidence Index, which had decreased sharply in October, declined again in November.  The Index now stands at 70.4, down from 72.4 in October.  The Present Situation Index edged down to 72.0 from 72.6.  The Expectations Index declined to 69.3 from 72.2 last month.

"Consumer confidence declined moderately in November after sharply declining in October.  Sentiment regarding current conditions was mixed, with consumers saying the job market had strengthened, while economic conditions had slowed.  However, these sentiments did not carry over into the short-term outlook.  When looking ahead six months, consumers expressed greater concern about future job and earning prospects, but remain neutral about economic conditions.  All in all, with such uncertainty prevailing, this could be a challenging holiday season for retailers", said Lynn Franco, Director of Economic Indicators at The Conference Board.

Consumers' assessment of overall current conditions decreased slightly.  Those claiming business conditions are "good" edged up to 19.9 percent from 19.5 percent, while those claiming business conditions are "bad" increased to 25.2 percent from 23.0 percent.  Consumers' appraisal of the job market was little changed.  Those saying jobs are "plentiful" ticked up to 11.8 percent from 11.6 percent, while those saying jobs are "hard to get" decreased slightly to 34.0 percent from 34.9 percent.

Consumers' expectations, which had decreased sharply in October, declined further in November.  Those expecting business conditions to improve over the next six months increased slightly to 16.6 percent from 16.0 percent, while those expecting business conditions to worsen decreased to 16.8 percent from 17.5 percent.  However, consumers' outlook for the labor market was more pessimistic.  Those anticipating more jobs in the months ahead fell to 12.7 percent from 16.0 percent, but those anticipating fewer jobs also decreased to 21.7 percent from 22.6 percent.  The proportion of consumers expecting their incomes to increase declined to 14.9 percent from 15.7 percent.  Those expecting a decrease in their incomes rose slightly to 15.9 percent from 15.5 percent.

Source:  November 2013 Consumer Confidence Survey, The Conference Board