The Conference Board Consumer Confidence Index, which had decreased in December, inched lower in January and continues to be at a historic low. The Index now stands at 37.7, down from 38.6 in December. The Present Situation Index declined slightly to 29.9 from 30.2 last month, while the Expectations Index decreased moderately to 43.0 from 44.2.
"The Consumer Confidence Index continues to hover at all-time lows [Index began in 1967] and it appears that consumers have begun the New Year with the same degree of pessimism that they exhibited in the final months of 2008," said Lynn Franco, director of The Conference Board Consumer Research Center. "The minor change in the Present Situation Index suggests that economic conditions did not deteriorate significantly further in January but, on the other hand, they did not improve either. Looking ahead, consumers remain quite pessimistic about the state of the economy and about their earnings. And, until we begin to see considerable improvements in the Expectations Index, we can't say that the worst of times are behind us.”
Those saying business conditions are "bad" increased to 47.9 percent from 45.8 percent, while those saying business conditions are "good" declined to 6.4 percent from 7.7 percent last month. Consumers' assessment of the labor market, however, was slightly more positive. Those claiming jobs are "hard to get" edged down to 41.1 percent from 41.5 percent in December, while those stating jobs are "plentiful" edged up to 7.2 percent from 6.5 percent.
Consumers' short-term outlook remains quite pessimistic, according to the analysis. Those expecting business conditions to worsen over the next six months decreased slightly to 31.1 percent from 32.9 percent, while those anticipating conditions to improve remained relatively unchanged at 13.3 percent in January, compared to 13.4 percent in December.
Meanwhile, the job outlook remains somewhat mixed. The percentage of consumers expecting fewer jobs in the months ahead decreased to 36.7 percent from 40.6 percent, while those expecting more jobs edged down to 9.4 percent from 9.8 percent. The proportion of consumers expecting an increase in their incomes declined to 10.0 percent from 12.7 percent.
The Consumer Confidence Survey is based on a representative sample of 5,000 U.S. households. The monthly survey is conducted for The Conference Board by TNS. TNS is the world's largest custom research company. The cutoff date for January's preliminary results was January 21.