Utahns’ Confidence in Economy at Highest Level Since 2011
Utahns believe their income will increase by more than the rate of inflation in the next two years, translating to more positive attitudes and more consumer spending.
The Zions Bank Utah Consumer Attitude Index (CAI) increased 9.1 points to 124.1 in September. The year-over-year CAI edged up by 1.9 points.
This marks the twenty-eighth consecutive month that the Utah CAI has exceeded 110, a level signaling overall positive consumer attitudes about the economy. The national Consumer Confidence Index® increased 3.7 points to 138.4 this month.
The Utah Present Situation Index jumped up 10 points in September to 140.3, the largest month-to-month increase for this index since November of 2013 and the highest point ever recorded since Zions Bank began measuring Utahns’ attitudes on the economy in 2011. The Present Situation Index is up 9.1 points since September 2017.
Both the month-to-month and year-over-year increases in the Present Situation Index were almost entirely driven by strong sentiment about the present availability of jobs, with 64 percent of Utahns feeling that jobs are currently plentiful.
The Utah Expectations Index also had a notable month-to-month rise of 8.5 points to 113.3. Year over year the Expectations Index has decreased 2.9 points. Considering the record favorability of Utahns’ present outlook, the dip in future expectations indicates that Utahns see things remaining stable, rather than getting significantly better. Even still, those who believe the job market will continue to grow (26 percent) outnumber those who think job availability will shrink (14 percent) by a ratio of almost two to one.
“We’ve seen that Utahns’ confidence in their investments overall has trended up since we began measuring consumer attitudes in 2011,” said Scott Anderson, Zions Bank president and CEO. “Now half of all Utahns feel it is likely or very likely that investments in a 401(k) will increase in value, versus 18 percent who feel that is unlikely. In a similar vein, Utahns have also become more and more confident that they will maintain their living standards into retirement. Both of these sentiments have helped contribute to the overall upward trend in the Utah CAI since we began the index.”
Utahns’ confidence in the economy is driven by three main things: Utahns’ feelings about costs in general, their income and their investments, according to Randy Shumway, chairman and partner of Cicero Group.
“One of the interesting stories is the interplay between Utahns’ expectations of their income and of costs in general,” Shumway said. “Most Utahns believe that prices are going up, with 64 percent feeling that prices for consumer goods will increase in the next twelve months. But we’re also seeing that more and more Utahns are believing that their income will increase by more than the rate of inflation in the next two years. This translates to more positive attitudes about the economy and more consumer spending now and in the future.”
Zions Bank provides the CAI as a free resource to the communities of Utah. The monthly CAI summary reports are released at a monthly press conference, coinciding with The Conference Board’s national CCI release date. Analysis and data collection for the CAI are conducted by Cicero Group, a premier data-driven strategy and research firm based in Salt Lake City. The October CAI will be released during a press conference at a local business at 10:30 a.m. on Oct. 30, 2018.
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