The Conference Board Consumer Confidence Index, which had declined sharply in February, fell further in March. The Index now stands at 64.5 (1985=100), down from 76.4 in February.
The Expectations Index declined to 47.9 from 58. The Present Situation Index decreased to 89.2 from 104 in February.
“Consumers’ confidence in the state of the economy continues to fade and the index remains at a five-year low (March 2003, 61.4),” said Lynn Franco, director of The Conference Board Consumer Research Center. “The decline in the Present Situation Index implies that the pace of growth in recent months has weakened even further. Looking ahead, consumers’ outlook for business conditions, the job market, and their income prospects is quite pessimistic and suggests further weakening may be on the horizon. The Expectations Index, in fact, is now at a 35-year low (Dec. 1973, 45.2), levels not seen since the Oil Embargo and Watergate.”
Consumers’ assessment of present-day conditions weakened further in March. Those claiming business conditions are “bad” increased to 25.4 percent from 21.3 percent, while those claiming business conditions are “good” declined to 15.4 percent from 19.1 percent. Consumers’ appraisal of the job market was also more pessimistic than last month. Those saying jobs are “hard to get” rose to 25.1 percent from 23.4 percent, while those claiming jobs are “plentiful” decreased to 18.8 percent from 21.5 percent.
Consumers’ short-term expectations also deteriorated further in March. Those expecting business conditions to worsen over the next six months increased to 25.4 percent from 21.6 percent, while those anticipating business conditions to improve declined to 8.1 percent from 9.7 percent in February.
The outlook for the labor market was also more pessimistic. Consumers expecting fewer jobs in the months ahead increased to 29 percent from 28 percent, while those anticipating more jobs declined to 7.7 percent from 8.9 percent. The proportion of consumers expecting their incomes to increase declined to 14.9 percent from 18.0 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, a custom research company. The cutoff date for March’s preliminary results was March 18.