U.S. consumer confidence takes a small step back

Expectations dampen with surge of new coronavirus cases

The author(s)

  • Catherine Morris Data Journalist, US, Public Affairs
  • Nicolas Boyon Senior Vice President, US, Public Affairs
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Visit our interactive portal, Ipsos Consolidated Economic Indicators (IpsosGlobalIndicators.com) for graphic comparisons and trended data pertaining to the Ipsos Global Consumer Confidence Index and  sub-indices -- and all the questions on which they are based.


Washington, DC, July 2, 2020 — At 50.3, Ipsos’s Consumer Confidence index continues to fluctuate, taking a step back after inching forward last week.

Meanwhile, the Expectations sub-index sees a substantial decline from the week prior. Consumer sentiment remains divided along partisan lines, with Republicans showing much greater signs of optimism about the future of the economy and jobs prospects than Democrats. Investment and Current sub-indices are unchanged, as Americans largely face the same circumstances as last week with a spike in new cases in many states and volatility in the stock market.

Just 49% of Americans believe the economy will recover quickly once social distancing restrictions are relaxed. Opinion is highly polarized along party lines as 66% of Republicans foresee a swift recovery compared to only 33% of Democrats.

Just over half of Americans still believe that the economy will recover quickly once social distancing restrictions are relaxed, but another half think that the nation should not reopen until the virus is contained. This split is driven by partisan differences in opinion – Republicans tend to think that the economy will bounce back quickly and favor reopening, while Democrats tend to hold opposing views on both counts.

Detailed Findings

1. Scoring at 50.3, the latest overall Consumer Confidence index is down 1.3 points over last week.

  • The Confidence index is about 13 points lower than it was at the beginning of the year (63.4), 10 points lower than in early March (60.1) and 2 points lower than its historical average.
  • Despite continued high rates of unemployment and other economic pressures, the index is currently 15.1 points higher than its 18-year low of 35.2 in March 2009.

Consumer Confidence

2. Expectations index drops by four points, but other sub-indices hold up.

  • The Expectations index, indicative of Americans’ outlook about their financial situation, local economy and employment, is down 4.1 points vs. last week, below its pre-pandemic level.
  • However, neither the Current index, indicative of sentiment about today’s economic environment, the Jobs index, indicative of the employment situation, nor the Investment index, show any significant change over last week.

Sub-indices

3. It is notable that the Jobs index shows little change as the Bureau of Labor Statistics reports that the U.S. economy added 4.8 million jobs last month. Though the unemployment rate in June declined to 11.1 percent from 13.3 percent in May, more than 48 million Americans have filed for unemployment insurance over the past 15 weeks, including 1.4 million last week.

  • This week, 41% of say they, someone in their family, or someone else they know personally lost their job in the last six months as a result of economic conditions.
  • In addition, 18% think this will be the case in the next six months (up from 15% last week, but down from 29% in late March-early April).
  • However, confidence in job security is unchanged, with 58% saying that they feel less confident about job security for themselves, their family and other people they know.

4. Americans remain divided on the question of whether the economy will recover quickly once restrictions are relaxed (49% agree, 46% disagree). The split is driven by optimism on the part of Republicans, and pessimism from Democrats.

Recover quickly

5. As new coronavirus cases continue to spike across the nation, Americans remain divided: 47% think the nation should reopen for business anyway and 49% are of the opposite opinion.
Restart the economy

6. Most Americans remain uncomfortable with making major and other household purchases.

  • Compared to six months ago, 63% say they are less comfortable making a major purchase like a home or a car, up from 61% last week.

Major Purchase

  • Compared to six months ago, 60% say they are less comfortable making other household purchases, up from 56% last week.

Other Purchase

 


Questions

The data used for the Consumer Confidence index and sub-indices is based on the following questions:

  1. Now, thinking about our economic situation, how would you describe the current economic situation in US? Is it… very good, somewhat good, somewhat bad or very bad?
  2. Rate the current state of the economy in your local area using a scale from 1 to 7, where 7 means a very strong economy today and 1 means a very weak economy.
  3. Looking ahead six months from now, do you expect the economy in your local area to be much stronger, somewhat stronger, about the same, somewhat weaker, or much weaker than it is now?
  4. Rate your current financial situation, using a scale from 1 to 7, where 7 means your personal financial situation is very strong today and 1 means it is very weak
  5. Looking ahead six months from now, do you expect your personal financial situation to be much stronger, somewhat stronger, about the same, somewhat weaker, or much weaker than it is now?
  6. Compared to 6 months ago, are you NOW more or less comfortable making a major purchase, like a home or car?
  7. Compared to 6 months ago, are you NOW more or less comfortable making other household purchases?
  8. Compared to 6 months ago, are you NOW more or less confident about job security for yourself, your family and other people you know personally?
  9. Compared to 6 months ago, are you NOW more or less confident of your ability to invest in the future, including your ability to save money for your retirement or your children’s education?
  10. Thinking of the last 6 months, have you, someone in your family or someone else you know personally lost their job as a result of economic conditions?
  11. Now look ahead at the next six months. How likely is it that you, someone in your family or someone else you know personally will lose their job in the next six months as a result of economic conditions?

Additional questions

Q. To what extend do you agree with the each of the following

  • The economy will recover quickly once the restrictions to control the coronavirus pandemic are relaxed.
  • We should restart the economy and allow businesses to open even if the virus is still not fully contained.

 


About the Study

These findings are based on data from an Ipsos survey conducted June 30-July 1, 2020 with a sample of 944 adults aged 18-74 from the continental U.S., Alaska and Hawaii who were interviewed online in English. The sample was randomly drawn from Ipsos’ online panel, partner online panel sources, and “river” sampling and does not rely on a population frame in the traditional sense. Ipsos uses fixed sample targets, unique to each study, in drawing a sample. After a sample has been obtained from the Ipsos panel, Ipsos calibrates respondent characteristics to be representative of the U.S. Population using standard procedures such as raking-ratio adjustments. The source of these population targets is U.S. Census 2016 American Community Survey data. The sample drawn for this study reflects fixed sample targets on demographics. Post-hoc weights were made to the population characteristics on gender, age, race/ethnicity, region, and education.

Statistical margins of error are not applicable to online non-probability polls. All sample surveys and polls may be subject to other sources of error, including, but not limited to coverage error and measurement error. Where figures do not sum to 100, this is due to the effects of rounding. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll has a credibility interval of plus or minus 3.6 percentage points for all respondents. Ipsos calculates a design effect (DEFF) for each study based on the variation of the weights, following the formula of Kish (1965). This study had a credibility interval adjusted for design effect of the following (n=944, DEFF=1.5, adjusted Confidence Interval=+/-5.1 percentage points).

Findings from previous time periods going back to March 2011 are based on data from Refinitiv /Ipsos’ Primary Consumer Sentiment Index (PCSI) collected in a monthly survey on Ipsos’ Global Advisor online survey platform with the same questions. For the PCSI survey, Ipsos interviews a total of 1,000+ U.S. adults aged 18-74. The Refinitiv/Ipsos Primary Consumer Sentiment Index (PCSI), ongoing since 2010, is a monthly survey of consumer attitudes on the current and future state of local economies, personal finance situations, savings and confidence to make large investments. The PCSI metrics reported each month consist of a “Primary Index” based on 10 questions available upon request and of several “sub-indices” each based on a subset of these 10 questions. Those sub-indices include a Current Index, an Expectations Index, an Investment Index and a Jobs Index.

Findings for January 2002- February 2011 are based on data from the RBC CASH Index, a monthly telephone survey of 1,000 U.S. adults aged 18 and older conducted by Ipsos with a margin of error of +/- 3.1 percentage points.

For more information on this news release, please contact:

Chris Jackson
Vice President, U.S., Public Affairs
Ipsos
+1 202 420 2025
chris.jackson@ipsos.com

Kate Silverstein
Media Relations Specialist, U.S., Public Affairs
Ipsos
+1 718 755-8829
kate.silverstein@ipsos.com

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The author(s)

  • Catherine Morris Data Journalist, US, Public Affairs
  • Nicolas Boyon Senior Vice President, US, Public Affairs

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