U.S. Consumer Confidence Fell Again in September

BOSTON – The U.S. Consumer Confidence Index declined again in September to 103.0, down from an upwardly revised 108.7 in August.

The Present Situation Index – consumers’ assessment of current business and labor market conditions – rose slightly to 147.1 from 146.7.

However, the Expectations Index – consumers’ short-term outlook for income, business and labor market conditions – fell to 73.7 in September after falling to 83.3 in August. Consumer fears of an impending recession also ticked back up, which the Conference Board says is “consistent with the short and shallow economic contraction we anticipate for the first half of 2024.”

“September’s disappointing headline number reflected another decline in the Expectations Index, as the Present Situation Index was little changed,” says Dana Peterson, chief economist at The Conference Board. “Write-in responses showed that consumers continued to be preoccupied with rising prices in general, and for groceries and gasoline in particular. Consumers also expressed concerns about the political situation and higher interest rates. The decline in consumer confidence was evident across all age groups, and notably among consumers with household incomes of $50,000 or more.”

Peterson says the present situation held on due to current business conditions and the availability of jobs.

“Fewer consumers said that business conditions were good, but fewer also said they were bad,” she says. “Regarding the employment situation, slightly more consumers said that jobs were ‘plentiful,’ but also slightly more said that jobs were ‘hard to get.’”

 When asked about current family financial conditions, a measure not included in calculating the Present Situation Index, the share of respondents citing a “good” situation fell again, and those citing “bad” conditions rose, signaling rising concerns about current family finances.

“Expectations for the next six months tumbled back below the recession threshold of 80, reflecting less confidence about future business conditions, job availability and incomes,” Peterson adds. “Consumers may be hearing more bad news about corporate earnings, while job openings are narrowing, and interest rates continue to rise – making big-ticket items more expensive.”

Overall, consumers weren’t quite as worried about interest rates in September, which surged in August, but their worries about stock prices grew. “Still, the measure of expected family financial situation six months hence worsened further.

“The proportion of consumers saying recession is ‘somewhat’ or ‘very likely’ rose in September after dropping in August,” says Peterson. “On a six-month moving average basis, plans to purchase autos were flat but remained at an elevated level, while plans to purchase appliances continued to trend upward. But plans to buy homes – more in line with rising interest rates – continued to trend downward.”

Present situation

Consumers’ assessment of current business conditions was slightly less pessimistic in September:

• 20.9% of consumers said business conditions were “good,” down from 21.5% in August
• 16.4% said business conditions were “bad,” down from 17.3%
• 40.9% o said jobs were “plentiful,” up from 39.9% in August
• 13.6% said jobs were “hard to get,” up from 13.2% last month

Future expectations six months from now

Consumers were less optimistic about the short-term business conditions outlook in September.

• 14.1% of consumers expect business conditions to improve, down from 17.5% in August
• 18.4% expect business conditions to worsen, up from 17.3%
• 15.5% expect more jobs to be available, down from 17.5% in August
• 18.9% anticipate fewer jobs, up from 18.0%

• 16.3% of consumers expect their incomes to increase, down from 18.7% in August
• 14.4% expect their incomes will decrease, up from 11.9% last month

Toluna conducts the monthly Consumer Confidence Survey for The Conference Board. The cutoff date for preliminary results was Sept. 18.

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