Americans’ economic outlook is higher than it has been since Fall of 2009, according to a new survey by Citi and conducted by Hart Research Associates.
The survey revealed that Americans are more optimistic about economic conditions than in any quarter since the survey began in September 2009. The Citi Economic Pulse, a quarterly measure of Americans’ attitude toward the economy, remains in negative territory, but rose to a new high of -4 in the third quarter, after hitting its slowest point of -17 in the third quarter of 2011.
Unlike previous years, attitudes have continued to improve in 2012.
“Consumer confidence has risen significantly in the last 12 months, and Americans are now more optimistic than at any point since we introduced the Citi Economic Pulse three years ago,” said Michelle Peluso, Chief Global Consumer Marketing and Internet Officer for Citi. “Whether or not that momentum will persist or fade is very much an open question, but this latest reading is an encouraging sign.”
In general, the third quarter Pulse finds less of an increase in positive views of the economy, but rather a notable decrease in negative views. For example, 75 percent of consumers rate employment opportunities in their area as only fair or poor, which is 10 points lower than a year ago (85 percent). In the same vein, 19 percent say local employment opportunities are excellent or good, which is six points higher than a year ago.
Overall, 28 percent of consumers rate the current condition of their local economy as excellent or good, which is a five-point increase since the third quarter of last year, while 70 percent rate their local economy as only fair or poor, a two-point decline since March 2012. In the coming year, 51 percent expect conditions to get a least somewhat better. This is a 10-point improvement since August 2011, when only 41 percent were optimistic. Interestingly, the greatest recent shift in consumer sentiment is being seen among the youngest and lowest-income groups, who typically are more sensitive to local economic conditions.
Over the past four years following the economic downturn, Americans have dramatically altered the way they save and spend, but within the past few months there are signs of another change as consumers say they are getting better control of their finances and fewer report making sacrifices because of the economy.
When given a list of possible changes to their saving and spending habits, more than three quarters (76 percent) of Americans report that they are getting better control of their finances or putting themselves on a budget. While 60 percent of Americans are currently cutting down on credit card purchases, that marks an eight-point decrease from November 2011. There is a similar drop in the number of consumers who say they have been eating out less often, from 67 percent who said so in August 2011 to 58 percent in the current survey. Some Americans are still forced to consider drastic financial decisions due to the slow economy: 29 percent are working longer hours to make ends meet, and 24 percent are doing jobs they would not choose in a better economy but each of these decreased five points since November 2011.
Citi, the leading global bank, has approximately 200 million customer accounts and does business in more than 160 countries and jurisdictions.