Herman Trend Alert:
Consumers Looking Up January 6, 2010
As we have reported in the past, consumer confidence
plays an important role in forecasting the future. Consumers' optimistic
expectations have a positive effect on many aspects of the economy.
According to recently released surveys from both The
Conference Board and the Pew Research Center, most people in the United States
looking up. According to the Pew survey, while only 27 percent of Americans had
a positive feeling about the 2000s, most (59 percent) think the coming decade
will be better than the last for the country as a whole, a view held across most
political and demographic.
At the same time, a significant minority---32
percent---believes that things will be worse in the 2010s than in the 2000s.
Republicans are twice as likely as Democrats (42 percent versus 20 percent) to
offer a pessimistic assessment of the next decade. Only a third (34 percent) of
independents holds a gloomy expectation.
Generationally, the most optimistic group is young
people, ages 18 to 29, 65 percent of whom feel positively about the next decade.
On the negative side, people between the ages of 50 and 64 are the most
pessimistic about the 2010s---42 percent think things will be worse. This
statistic compares with 30 percent of people under 50 and just 26 percent of
those ages 65 and older.
In both November and December, The Conference Board
Consumer Confidence Index®, rose. The Index now stands at 52.9, up from 50.6 in
November. The Expectations Index increased to 75.6 from 70.3 last month.
Expectations for the short-term future increased to the highest level in two
years (Index 75.8, Dec. 2007). A more optimistic outlook for business and labor
market conditions was the driving force behind the increase in the Expectations
The outlook for the labor market was also more upbeat.
The percentage of consumers expecting more jobs to become available in the
months ahead increased to 16.2 percent from 15.8 percent, while those expecting
fewer jobs decreased to 20.7 percent from 23.1 percent.
These positive expectations will support higher levels
of consumer spending and therefore, drive retail sales as well as the labor
market. Expect the labor market to tighten even more for in-demand skill sets.
Publication is allowed by permission of The Herman
Group, Inc., and must include the following attribution:
"From 'The Herman
Trend Alert,' by Joyce Gioia, Strategic Business Futurist. (800) 227-3566 or http://www.hermangroup.com.
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