Recent gains in consumer confidence vanish as index drops by nearly two points

Most Americans do not believe in a quick recovery after the lockdown is over

The author(s)

  • 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, May 7, 2020 — After showing some improvement for a couple of weeks, Americans’ consumer sentiment is souring again. Ipsos’s Consumer Confidence index shows a dip of 1.8 points from last week, erasing the gains seen in the second half of April. Based on a survey of nearly 1,000 U.S. adults conducted May 5-6, the index is now at 46.2, where it was six weeks ago, soon after many parts of the country went into lockdown.

The survey shows that Americans who do not expect the economy to recover quickly once the lockdown is over are now a majority (53%, up 4 percentage points since last week) and outnumber by 10 points those who are optimistic about a speedy economic rally.

About seven in ten Americans feel less comfortable making a major purchase, such as a home or a car, (72%) or other household purchases (68%) than they were six months ago.

Detailed Findings

  1. With an index score of 46.2, overall consumer confidence is lower today than it was last week by nearly two points. Yet, it is still one point higher than it was in mid-April.
    1. The Confidence index is 17 points lower than it was at the beginning of the year (63.4), 14 points lower than it was in early March (60.1). Prior to the pandemic, the last time the Consumer confidence index was lower than it is now was February 2012.
       

      Consumer Confidence

       

  2. All sub-indices show a drop over last week.

    1. The Jobs index, indicative of the employment situation and outlook, shows the steepest decrease over last week: 2.8 points. It is now almost 20 points lower than in early March.
    2. The Current index, indicative of sentiment about today’s economic environment is down 1.5 points over last week and, just as the Jobs Index, nearly 20 points below where it was two months ago.
    3. The Investment index is down 1.7 points over last week and more than 15 points below its early-March level.
    4. In contrast, while lower than last week by 1.4 points, the Expectations index, indicative of Americans’ outlook about their personal financial situation, their local economy and employment, is roughly at the same level as it was before any part of the U.S. went under lockdown.Sub-Indices

       

  3. Only 43% agree that the economy will recover quickly once the lockdown is over (down 4 points since last week) while 53 % disagree (up 4 points).
    1. Optimism about a speedy economy rebound remains the majority view among Republicans, but it has receded from 63% to 58% since last week.
    2. Optimism is down significantly among those with a household income of $100,000 or more (45%, down 8 points), residents of the West (37%, down 8 points) and the Midwest (39%, down 6 points), and those under the age of 55 (40%, down 7 points).Opinion1

       

  4. A majority of Americans (57%) disagree that “we should restart the economy and allow businesses to open even if the virus is still not fully contained”. Those who agree make up 39% of the public (+2 points over last week).
    1. In addition to partisan polarization (58% of Republicans agree vs. only 24% of Democrats), there are notable differences by age (44% of those aged 55+ agree vs. 33% of those under 35), gender (43% of males agree vs. 34% of females), geography (43% in the South agree vs. 29% in the West), and race (43% of whites agree vs. 30% of non-whites).Opinion2

       

  5. Compared to six months ago, 72% say they are less comfortable making a major purchase, like a home or car and 68% say they are less comfortable making another household purchase.
    1. These percentages are very close to those seen in each of the past six weeks.

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

  1. To what extent do you agree or disagree with each of the following?
    1. The economy will recover quickly once the lockdown is over
    2. 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 May 5-6, 2020 with a sample of 953 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 3.5 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=970, DEFF=1.5, adjusted Confidence Interval=+/-5.0 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)

  • Nicolas Boyon Senior Vice President, US, Public Affairs

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