Utah’s consumers are approaching the holidays with economic optimism. According to Zions Bank Utah Consumer Attitude Index (CAI) survey for November, more than 70 percent of Utahns plan to spend as much or more than last year on their holiday shopping and that’s good news for the state’s retailers.
A little more than half (50.7 percent) of holiday spending is expected to be done online, compared to 44.5 percent at brick-and-mortar stores. And Utah households plan to spend an average of nearly $1,100 on holiday shopping this year, the survey found.
Overall, the CAI remained unchanged from October to November at 120.5. Year-over-year the CAI decreased by 3.9 points compared to November last year. Meanwhile, the national Consumer Confidence Index decreased 2.2 points to 135.7 in November.
The Utah Present Situation Index, a sub-index of the CAI, increased 2.6 points to 133.7 while the Utah Expectations Index dropped 1.8 points to 111.7. Utahns’ sentiment remains highly positive, with 64 percent believing business conditions are good, the highest level recorded since Zions Bank began tracking the CAI in 2011. Similarly, sentiment on current job availability is nearly as positive as it has ever been, with 63 percent of Utahns feeling jobs are plentiful.
The year-over-year drop in the Expectations Index is due largely to a stabilizing of Utahns’ expectations regarding future business conditions; 26 percent feel business conditions will improve, 6 percent less than in November 2017. Similarly, more Utahns are feeling that household income and job availability will remain the same in the coming months as compared to those who feel that conditions will improve.
Utahns are also anticipating a tempering of housing prices, while 53 percent feel housing prices will increase over the next 12 months. That is the lowest percentage since December of 2015.
“Utahns tend to be both grounded and optimistic,” said Scott Anderson, Zions Bank president and CEO. “Sentiment about the current state of the economy has steadily improved overall since 2011, right along with general economic conditions. It is clear that Utahns currently believe business conditions are healthy and vibrant here in the state.”
While Utahns widely (73 percent) believe interest rates will continue to rise, confidence in accompanying economic factors remains strong.
“The fact that so many are still confident that housing prices will still increase and that a 401(k) investment will increase in value suggests that Utahns are confident that economic fundamentals are strong and that the economy will continue to grow,” said Randy Shumway, chairman and partner of Cicero Group, a Salt Lake City research firm that does data collection and analysis for the CAI.