Job woes still holding shoppers back
Consumer confidence remains weak
NEW YORK - Consumer confidence remained weak in September after dropping to a post-recession low in August. That has left economists to wonder what will get Americans feeling good about the economy.
Economists say the problem is that not much has changed. The stock market is still volatile. Worries about the global economy persist. And perhaps worst of all, jobs are still scarce.
“We are well below where we should be, and that’s because the unemployment situation is so bad,’’ said Paul Dales, senior US economist at Capital Economics. “You have to have a huge fall in the unemployment rate.’’
The Conference Board, a private research group, said yesterday that its consumer confidence index was at 45.4 in September, slightly above the revised reading in August of 45.2, which was the lowest since April 2009. A reading of above 90 indicates the economy is on a solid footing.
Economists say it will take at least a year for confidence to improve significantly.
Net job creation came to a halt in August. The US unemployment rate was flat at 9.1 percent. Home prices remain weak. And consumers are facing higher prices for everything from food to clothing as retailers try to offset their rising costs for labor and materials.
Those who say jobs are “hard to get’’ increased to 50 percent, from 48.5 percent. And the proportion of consumers anticipating an increase in their income declined to 13.3 percent from 14.3 percent.
That “does not bode well for spending,’’ said Lynn Franco, director of The Conference Board Consumer Research Center.
Economists say monthly job gains of at least 200,000 will be the most critical component in raising confidence.
Some challenges are starting to ease. Gas prices, while higher than last year, are starting to come down. The national average is at $3.48, according to AAA. That’s up about 78.5 cents from a year ago but 13 cents lower than a month ago.
Prices on clothing and home furnishings will start to come down by spring, said Scott Wren, at Wells Fargo Advisors.
Jobs figures are due Oct. 7. But the unemployment rate is expected to remain unchanged at 9.1 percent with employers having added just 75,000 jobs.