Utahns continue to have more confidence in the economy than consumers nationwide. However, that confidence is sliding in the state while still growing across the country. The Zions Bank Utah Consumer Attitude Index (CAI) decreased 3.2 points to 105.7 in January while the national Consumer Confidence Index increased 1.8 points from December to January to 98.1.
Utahns continue to have more confidence in the economy than consumers nationwide. However, that confidence is sliding in the state while still growing across the country. The Zions Bank Utah Consumer Attitude Index (CAI) decreased 3.2 points to 105.7 in January while the national Consumer Confidence Index increased 1.8 points from December to January to 98.1.
Slightly more negative perspectives about the present circumstances of the economy contributed to the decline, though present concerns were balanced by expectations for the future, which were more positive than they were in December. The CAI now sits 7.7 points lower than its level 12 months ago.
The Present Situation Index, the sub-index of the CAI that measures how consumers feel about current economic conditions, has fallen 1.6 points since this time last year. Forty-eight percent of Utahns rate general business conditions in their area as good — a 3 percent decrease from December and a 2 percent decrease since last year. Forty-one percent of Utahns describe available jobs in their area as plentiful, a 9 percent decrease from December. However, this still represents a 3 percent increase over a year ago.
Expectations for the next six months increased due to a more positive outlook on business conditions, future job availability and income situations. Compared to December, more Utahns think business conditions in their area will be better in six months, rising from 24 percent to 30 percent in January. Twenty-nine percent of Utahns think there will be more jobs available in their area six months from now—a four-point increase from December. In line with this expectation for more job opportunities, more people expect their household income to be higher six months from now—36 percent in January compared to 33 percent in December.
“Although Utahns’ attitudes regarding the present situation have fallen in line with an increasingly volatile and frustrating stock market of late, most consumers remain optimistic regarding the economy’s future,” said Scott Anderson, president and CEO of Zions Bank. “While recent market trends have raised concerns among consumers, positive expectations indicate that stock market corrections will give way to continued improvement of ongoing business conditions.”
Gas prices in Utah have fallen in spite of the statewide implementation of an additional 5-cent tax, with prices in the state averaging $1.96 last week, while the national average has fallen to $1.83 per gallon. Most consumers expect the trend of falling gasoline prices to reverse over the next 12 months. Only eight percent of Utahns expect gasoline prices to go down over the next year.
Many Utahns also expect prices for consumer goods to rise— 68 percent of Utahns expect prices for consumer goods to increase during the next 12 months, which is a 2 percent increase over December. The number of Utahns who expect interest rates for borrowing money to go up over the next year remained unchanged at 72 percent. Meanwhile, only 32 percent of consumers expect $1,000 invested in their 401(k) to be worth more than $1,000 a year from now, compared to 39 percent in December.
Satisfaction with the steps taken by the federal government to improve the overall economy of the U.S. was up slightly in January, with 11 percent of Utahns indicating belief that the federal government is doing a good job compared to 9 percent in December. While approval of the state government is much higher with 41 percent of Utahns saying the state is doing a good job improving the overall state economy, this represents a one-percent decrease from December.
Utahns’ confidence in their personal financial situations edged downward in January. Seventy-two percent of employed Utahns think it is unlikely they will lose a job they want to keep in the next two years, down from 80 percent in December. Similarly, 36 percent of working Utahns think they will be able to maintain their living standards upon retirement, a decrease of 2 percent from December. Twenty-four percent of consumers expect their household income to increase more than the rate of inflation in the next two years, which is down 2 percent from December.