UF Survey: Florida Consumer Confidence Falls To Lowest Level This Year
GAINESVILLE, Fla. — The Florida Consumer Confidence index plunged in December to its lowest point in two years, reflecting recession fears and unhappiness with the election outcome, University of Florida economists said today.
The preliminary index for December fell eight points, from 104 to 96, its lowest level since November 1998, said Chris McCarty, survey director for UF’s Bureau of Economic and Business Research.
“Retail sales have been sluggish this year, indicating growth of less than 3 percent over last years’ sales,” McCarty said. “Last month’s index would have suggested higher than 3 percent growth for the holiday season. While a decline of confidence in December is not at all unusual, it is probably more a function of nervousness about a possible recession than their personal finances now.”
Unlike previous fluctuations, the drop appears to be directly attributable to differences based on political party affiliation, he said.
The overall index for Republican respondents was 105, compared with 91 for Democrats and 92 for Independents, McCarty said. Only 15 percent of the Republican respondents see bad times during the next five years, compared with 35 percent of the Democratic respondents, he said.
“We should keep in mind that several things have occurred in the past few months besides the election,” he said. “Perhaps the biggest effect on the stock market has been negative earnings reports from several companies, particularly among those in the technology sector. However, there is no doubt that some consumers, particularly Democrats, are not happy with the outcome of the election and may actually react to it.”
Floridians were less optimistic for all five of the components that make up the index, with the biggest declines in perceptions of national business conditions over the short and long term.
The component measuring perceptions of conditions during the next year now stands at 85, down 15 points from November and 34 points since August, McCarty said. The one measuring perceptions of the economy over the next five years has fallen 23 points since August, he said.
The bureau conducts the Florida Consumer Attitude Survey monthly. Respondents are 18 or older and live in households telephoned randomly. The preliminary index for December was calculated from 942 responses. Numbers for prior months are based on about 1,000 responses. The margin of error for the index is 3 percent.
Consumer confidence is designed to help predict buying patterns by measuring consumers’ mood toward buying. Although other economic indicators also are predictors of buying patterns, consumer confidence tends to be available sooner than those indicators.