Error message

  • Warning: preg_match() [function.preg-match]: Unknown modifier '2' in getOS() (line 1183 of /home/citywire/public_html/sites/all/themes/tcw/template.php).
  • Warning: preg_match() [function.preg-match]: Unknown modifier 'c' in getOS() (line 1183 of /home/citywire/public_html/sites/all/themes/tcw/template.php).

The Consumer Compass Report: Regional sentiment hits new lows

The fifth edition of The Consumer Compass Report shows a drop in confidence with respect to personal finances and the overall economy — a finding that should come as no surprise to anyone closely watching economic conditions locally and at the state and national levels.

The Consumer Compass Report, an offshoot of The Compass Report that is managed by The City Wire and presented by Benefit Bank, reflects trends seen at the national level. The Bloomberg Consumer Comfort Index recently hit a low not seen since October 2008. The Consumer Confidence Index published by The Conference Board fell to a low not seen since April 2009.

“A contributing factor may have been the debt ceiling discussions since the decline in confidence was well underway before the S&P downgrade,” noted Lynn Franco, director of The Conference Board Consumer Research Center. “Consumers' assessment of current conditions, on the other hand, posted only a modest decline as employment conditions continue to suppress confidence."

The University of Michigan Consumer Sentiment Index has fallen 25% in the past three months, the second largest decline in the history of the closely-watched index.

“Consumer confidence plunged in August as consumers became increasingly convinced that a renewed recession was likely to occur,” noted the UM report. “The majority of households reported worsened finances, expected no in-come gains, and were more likely to anticipate a rising un-employment rate during the year ahead.”

With that as a backdrop, following are several points of analysis from Talk Business Research about consumer sentiment in the Fort Smith region as captured by The Consumer Compass Report.
• This is our fifth poll for The City Wire, which gives us our first chance to compare quarter-to-quarter responses over a one-year period. There is some remarkable consistency and notable changes. Financial conditions for residents in the Fort Smith region remain pessimistic, but steadily pessimistic. 44% describe their financial situation as worse than one year ago with only 11% saying it is better.

• Conversely, 38% think their financial positions will be worse in the next year with only 12% saying it will be better. These two questions, when comparing the most recent quarter to last quarter and to last year's same quarter, are basically unchanged. In other words, there remains weak hope for personal financial improvement and it has been that way for the last year.

• There were interesting shifts in questions regarding Fort Smith business conditions and leadership on the regional business environment. First, the survey shows there has been a marked degradation in perceptions about local business conditions. Nearly 10% of respondents indicated that conditions over the next year won't be the same as today, and their perception is that it will get worse. One-half of residents in the region (50.5%) see worsening business conditions.

• However, that notion is somewhat countered by responses to how local leaders are setting policies and taking actions to improve business and job growth. Last quarter, 36% felt actions and policies were "bad," but that number dropped to 30% in our latest survey. While the "good" marks aren't strong (just 8%), when combined with the "Okay, but could be better" response, a majority (51%) have a positive impression of the business environment in the region.

• Some explanations for this "feel good" versus "feel bad" mentality could be from the psychology of local economic announcements in recent weeks. There is obviously fret regarding Whirlpool and its impact on the community; however, there have been high-profile announcements regarding activity at the Fort Smith Regional Chamber of Commerce and new initiatives (Fort Smith Regional Alliance) that could stoke positive jobs momentum locally.

• One final note: it has been a tough summer on the jobs front as the number of major layoffs and unemployment have risen, weather conditions have harmed economic activity, and the national economic picture remains confusing, polarizing and unsolvable. From last quarter to this quarter, there was a 10% increase (52% to 62%) in the number of respondents who think the U.S. economy will worsen in the next year. This makes the effort to restore consumer confidence even more daunting of a task as the needle to move towards more optimism heads in the wrong direction.

The Consumer Compass Report — The City Wire Poll
Conducted by Talk Business Research and Hendrix College on Sept. 8. There were 523 Respondents in the Fort Smith region.
Margin of Error +/- 4.3%

Q1. How would you describe your personal financial situation? Are you better off financially, worse off, or about the same as you were one year ago?
11%    Better
44%    Worse
41%    Same
4%    Don’t know

Q2. Now looking ahead — do you think that one year from now your personal financial situation will be better off, worse off, or about the same?
12%    Better
38%    Worse
37%    Same
13%    Don’t know

Q3. Turning to business conditions in the Fort Smith region as a whole — do you think that during the next year, local business conditions will get better, get worse or stay about the same?
9.5%    Better
50.5%    Worse
29.5%    Same
10.5%    Don’t know

Q4. What about the U.S. economy?  During the next year, do you think business conditions in the United States will get better, get worse or stay about the same?
14%    Better
62%    Worse
16%    Same
8%    Don’t know

Q5.  Considering the regional business environment, do you believe the actions and policies of county and local governments in the Fort Smith region are good for business and job growth, bad for business and job growth, or somewhere in between?
8%    Good
43%    OK, but could be better
30%    Bad
19%    Don’t know

Q6.  Considering the state business environment, do you believe the actions and policies of state government officials — elected and appointed — are good for business and job growth, bad for business and job growth, or somewhere in between?
10%    Good
40%    OK, but could be better
35%    Bad
15%    Don’t know

Q7.  Considering the national business environment, do you believe the actions and policies of federal government officials — elected and appointed — are good for business and job growth, bad for business and job growth or somewhere in between?
6%    Good
43%    OK, but could be better
40%    Bad
11%    Don’t know

Notes  on Raw Data:
Age
2%    Under the age of 30
11%    Between the ages of 30 and 44
38%    Between the ages of 45 and 64
49%    65 or older

Ethnicity
2%    African American
2%    Asian American
89%    Caucasian or White
3%    Latino
4%    Other

Advertisement:

Household Income
62%    Less than $50,000
22%    $50,000 - $75,000
10%    $75,001 - $100,000
5%    More than $100,000

Education
35%    High school degree or less
40%    High school degree and some college, but no degree
9%    Two-year (associate’s) degree
11%    Four-year college degree
5%    Masters degree or higher

Gender
40%    Male
60%    Female

Five Star Votes: 
No votes yet

Like This Article? Share It!