Indicators say the coronavirus pandemic devastated consumer’s confidence in April as business and labor market conditions declined.
The Conference Board Consumer Confidence Index fell in April, following a sharp drop in March. It now stands at 87, down from 119 one month ago. The Present Situation Index saw a dramatic drop to a record 76, down from 167.
“Consumer confidence weakened significantly in April, driven by a severe deterioration in current conditions,” said Lynn Franco, The Conference Board’s senior director of economic indicators, in a statement.
But the news isn’t all grim. The Expectations Index, which considers consumers’ short-term outlook for income, business and labor conditions, improved to 94 this month, up from 87 in March.
Franco said consumers’ short-term expectations for the economy and labor market improved, prompted by the possible easing of stay-at-home restrictions.
“However, consumers were less optimistic about their financial prospects and this could have repercussions for spending as the recovery takes hold,” she said. “The uncertainty of the economic effects of COVID-19 will likely cause expectations to fluctuate in the months ahead.”
The monthly survey is based on a random sample and is conducted by Nielsen.
Researchers found those who said business conditions are “good” declined to 21 percent from 39 percent, while interviewees claiming business conditions are “bad” increased to 45 percent, up from 12 percent.
Consumers also had a vastly worse view of the job market compared to last month. Those saying jobs are “plentiful” dropped to 20 percent from 43 percent, and those who said jobs are “hard to get” increased to 34 percent from 14 percent.
Still, consumers were optimistic in the short term. The percentage of consumers expecting business conditions to improve over the next six months increased to 40 percent from 19 percent. But those expecting business conditions to worsen also increased to 26 percent from 16 percent.
The number of people expecting more jobs rose to 41 percent from 17 percent, while the proportion expecting a decrease rose to 21 percent from 18 percent.
A PYMNTS poll on April 11 found 45 percent of all consumers expected the pandemic to last six months. That’s up from 33 percent who said it would last six months or longer on March 27, and 31 percent who believed the same on March 17.
The report’s most recent data says consumers now expect the pandemic to last until Oct. 6, as they get increasingly pessimistic about how long the crisis will linger.