February 29, 2024

April consumer sentiment continues to rise despite mixed signals from labor market

Consumer sentiment among Floridians ticked up 1.7 points in April to 83 from March’s revised figure of 81.3. Similarly, national consumer sentiment increased 3.4 points.

“Consumer sentiment dropped at an unprecedented rate in the second quarter of 2020, when it tumbled 26 points between February and April. One year since, consumer confidence remains 19.3 points below pre-pandemic levels, indicating that confidence has recovered at a slow pace,” said Hector H. Sandoval, director of the Economic Analysis Program at UF’s Bureau of Economic and Business Research.

Among the five components that make up the index, three increased, one decreased, and one remained unchanged.

Floridians’ opinions about current economic conditions were mixed. On one hand, perceptions of personal financial situations now compared with a year ago increased 4.2 points from 68.4 to 72.6, the greatest increase of any reading this month; however, opinions varied by demographics with men and people older than 60 reporting less-favorable opinions. Opinions as to whether now is a good time to buy a big-ticket item, such as refrigerators, cars, or furniture dropped 1.1 points from 77.8 to 76.7. Similarly, opinions were split by demographics, but in this case men and people age 60 and younger expressed more pessimistic views.

Future economic expectations portrayed an improved outlook in April. Expectations of personal finances a year from now increased 1.7 points from 90.6 to 92.3. The one-year outlook of U.S. economic conditions remained unchanged at 85.7 points while expectations of U.S. economic conditions over the next five years increased 3.8 points from 83.7 to 87.5. Future outlooks were also split by demographics, with women and people with annual income under $50,000 reporting less favorable opinions consistently across the three components.

“Overall, Floridians are more optimistic in April. The increase in consumer confidence is fueled by improvements in Floridians’ personal financial situations now compared with a year ago, which largely reflects the impact of the federal stimulus payments,” Sandoval said.    

The latest Florida jobs report from the Department of Economic Opportunity noted that 32,200 jobs were added statewide in March, a 0.4% increase over the month, and showed that the unemployment rate remained unchanged at 4.7%. Notably, the unemployment rate had dropped every month since May 2020 until February 2021. Worker filings for unemployment benefits increased in April, averaging 20,466 weekly jobless claims. Furthermore, the number of weekly claims posted in April are among the highest since February. These latest developments suggest that the labor market is losing momentum.

“While Florida’s labor market recovery is stalling, the increase in consumer confidence over the last month suggests increased consumer spending and a potential boost to the state economy,” Sandoval said. 

Conducted April 1-29, the UF study reflects the responses of 166 individuals who were reached on cellphones and 157 individuals reached through an online panel, a total of 323 individuals, representing a demographic cross section of Florida. The index used by UF researchers is benchmarked to 1966, which means a value of 100 represents the same level of confidence for that year. The lowest index possible is a 2, the highest is 150.

Details of this month’s survey can be found at http://www.bebr.ufl.edu/csi-data

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