Consumer confidence declined in November, interrupting a steady rise in sentiment since mid-year, according to the Conference Board, a New York-based private research group. But while Americans are feeling less upbeat about the economy and labor market, they still indicated plans to spend more, according to the research.
More people noted they plan to buy new appliances, including televisions, vacuum cleaners and washing machines, within the next six months. Buying plans also rose for homes and used cars.
The conflict between confidence and spending plans clouds the trickle down expectations for the collection business.
The Conference Board's report itself is at odds with other readings on consumer sentiment. The Conference Boards index fell to 88.7 in November from an October reading of 94.1, which was the highest mark since October 2007. But the Thomson Reuters/University of Michigan preliminary November gauge actually reached a seven-year high. Meanwhile, the Bloomberg Consumer Comfort Index rose last week to the highest level since January 2008.
But the share of respondents in the Conference Boards survey that said they expect their incomes to rise in the next half year decreased, to 16.3% this month from 16.7% in October. Fewer consumers expect more jobs to become available in the next six months as the share fell to 15% from 16%.
The Conference Boards measure averaged 96.8 during the last expansion and 53.7 during the recession that ended in June 2009. The median forecast of 75 economists in the Bloomberg survey called for a reading of 96, with estimates ranging from 93.5 to 99 after a previously reported October index of 94.5.
The Conference Boards data showed Americans' take on current and future labor-market conditions weakened. The share of Americans who said jobs are currently plentiful fell to 16% from 16.5%. The share that said jobs are hard to find was little changed at 29.2% after 29% in October.
Consumers' spending plans may be getting a lift in part by cheaper prices at the gas pump. A gallon of regular fuel cost $2.81 on average Tuesday, the lowest since November 2010, based on data from AAA, the largest U.S. motoring group. Also, employment has climbed by at least 200,000 for nine consecutive months, Labor Department data show. The last time that happened was a stretch ending in March 1995. At this years pace, the jump in payrolls for 2014 would be the biggest since 1999.
Retailers also are increasing incentives to encourage shoppers this holiday season. Target, for example, is offering free shipping for online orders and limited edition apparel and accessories to sway customers. The National Retail Federation expects retail sales to rise 4.1% this holiday season, beating the 2.9% average over the last 10 years.
