Citi California Pulse® Survey Finds Nearly Half of Californians Believe 2012 will be Better than 2011

Nearly half of Californians believe 2012 will be better than 2011, according to the latest Citi California Pulse®, a sign that the state’s residents are increasingly optimistic about the coming year. Thirty-three percent expect this year to be about the same as last year, and only 17 percent say it will be worse.

Rebecca Macieira-Kaufmann, President of Citibank California (Photo: Business Wire)

Additionally, Citibank’s latest quarterly survey found that the outlook is improving among residents regarding the California economy, jobs and their personal finances. Looking ahead 12 months, 66 percent of Californians say their personal financial situation will be better, 52 percent say the California economy will improve, and 51 percent say job opportunities will brighten. When asked how they feel about the state, 85 percent say they are proud of California and 63 percent say it is an excellent or good place to live.

“We are pleased to see this optimism going into the new year and that many Californians are looking forward to improving conditions in 2012,” said Rebecca Macieira-Kaufmann, President of Citibank California. “Our survey continues to show the incredible resilience and pride of Californians, which is a great sign for the state’s future.”

When asked about California’s leadership position in certain industries, 66 percent say the state remains a leader in the Entertainment Industry, 47 percent in Technology, 43 percent in the Green Industry, 43 percent in Fashion/trend-setting, and 20 percent in Education.

Citi California Pulse® Optimism Index

The Citi California Pulse Index of Optimism rose to -4 in the fourth quarter of 2011, up from -7 in the third quarter. At 0, the index would be on the exact middle point of all possible scores, which range from +100 to -100.

Among the survey’s key findings:

• 64 percent say they are worried about another recession;

 

• 59 percent believe their debt level will be lower in 12 months;

 

• 58 percent say more jobs and a rising employment rate would be the best signs that the California economy is improving; only 1 percent say construction on new housing would be a sign of improvement;

 

• 57 percent say the U.S. economy concerns them the most among economies, while 28 percent say the California economy is their biggest concern and only 11 percent say Europe.

 

Spending and Saving Behavior

The survey showed continuing changes in spending and saving among Californians, with 64 percent saying the behavior represents a permanent change. According to the survey:

• 68 percent have cut down on credit card use;

 

• 60 percent have reduced the amount of money they owe;

 

• 57 percent have postponed the purchase of a major item, such as a car;

 

• 55 percent of those aged 18 to 34 have changed living arrangements to save money;

 

• 50 percent have taken money out of investments to help pay expenses.

 

When asked how they feel about retirement, 55 percent of Californians say they are somewhat or very uncomfortable with their current level of savings; 46 percent of those aged 35-54 have thought about postponing retirement.

Regional Differences

The latest survey again found significant differences among residents of Southern California and Northern California, particularly in the San Francisco Bay Area, where residents are much more optimistic than the rest of the state. The California Pulse Index of Optimism came in at +11 in San Francisco, while it was -4 in San Diego and -6 in Los Angeles; the total for all other counties in the state was -5.

• 73 percent in the Bay Area believe their financial situation will be better in 12 months, compared to 62 percent in San Diego and 61 percent in Los Angeles.

 

• 62 percent of Bay Area residents expect that job opportunities will improve in the next 12 months, compared to 50 percent in Los Angeles and 47 percent in San Diego.

 

• In the Bay Area, 59 percent of respondents say they expect 2012 to be better than 2011, compared to 52 percent in Los Angeles and 41 percent in San Diego.

 

• 30 percent in the Bay Area say things in California are headed in the right direction, compared to 23 percent in Los Angeles and 21 percent in San Diego.

 

• Looking at current conditions, 19 percent in the Bay Area call the job environment excellent or good, while just 8 percent in Los Angeles and San Diego feel the same.

 

About the Survey

The Citi California Pulse® is a quarterly survey focused on California consumer and small business sentiment regarding the current and future economic environment. This Citibank poll was conducted by telephone December 16-22, 2011, among a random sample of 1,480 California residents, age 18 and older throughout the state. Interviews were conducted in both English and Spanish. The design includes interviews with cell phone respondents and a small number of Asian and Hispanic re-contact interviews, as well as 312 interviews in the San Francisco MSA, 292 interviews in the Los Angeles MSA, and 301 interviews in the San Diego MSA. The cell phone and MSA samples are weighted to the correct proportions.

The margin of error for the entire sample is approximately +/- 3 percentage points. The margin of error is higher for subgroups. Surveys are subject to other error sources as well, including sampling coverage error, recording error, and respondent error. Abt SRBI Public Affairs, a major national polling firm, conducted all interviewing. For additional information, visit: www.srbi.com.

Index Methodology

The Citi California Pulse® Index of optimism is calculated by subtracting negative responses to each item from the positive responses for all 12 index items. The Index scale can range from +100 (if every respondent gave positive response to each of the 12 questions) to -100 (if all respondents expressed consistently negative views).

About Citi

Citi, the leading global financial services company, has approximately 200 million customer accounts and does business in more than 160 countries and jurisdictions. Citi provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, transaction services, and wealth management.

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