By Michael Patrick McSweeney (@mpmcsweeney)
Fifty-eight percent of consumers indicate that the Great Recession still weighs heavily on their ability and desire to spend, a newly released Nielsen consumer confidence study reveals.
This figure was derived from consumer responses for the third quarter of 2013, and according to the report, it is three percentage points higher than last quarter’s results. Overall, the numbers suggest a gradual, year-over-year improvement in consumer sentiment is taking place.
Declines in negative consumer sentiment were reported in the world’s major economies. When asked if they felt they were living “in a recession,” 68 percent of U.S. respondents answered yes, a 13 percent drop from the second quarter.
Despite continued economic stress in Europe, Nielsen found that consumers in Greece (90 percent), Ireland (93 percent), Italy (97 percent) and Spain (89 percent) are reporting improved sentiment.
While consumer confidence remains suppressed because of the lingering effects of the Great Recession, Nielsen’s data suggests that consumers are ready to start buying electronics, pay down their credit cards and even put money away for retirement.
Given the present conditions, what are consumers willing to purchase? Read on to learn more about what respondents had to say about their post-recession spending habits.
Emerging Markets Feel Recession’s Bite
Nielsen’s data shows that fewer people in the world, particularly in the United States, the United Kingdom and China, believe their nation’s economy to be in a recession. However, data from emerging markets tells a different story.
The number of respondents in India who said they are feeling the recession’s effects in the third quarter of 2013 rose to 76 percent, up from 51 percent in the second quarter. Similar movements were seen in Brazil and South Africa, where economic pessimism climbed by 14 percent (to 55 percent) and 10 percent (to 77 percent), respectively.
Europe Shakes Recession Blues
Consumer confidence rose in 70 percent of the European countries included in the report. Positive sentiment rose 22 percent in Portugal, 9 percent in Belgium and 8 percent in the U.K.
Confidence dipped in The Netherlands and Ireland by 1 percent. A decline was more significant in Ukraine, where confidence fell 13 percent.
Consumers Still Have Money To Spare
Despite continued economic struggles around the globe, Nielsen’s data shows that consumers are still willing to spend what they can spare. Sixty-one percent of respondents said they intended to spend money on new clothes during the third quarter, an 11 percent increase from the second quarter of 2013.
Spending intentions for new technology, travel and entertainment products and services rose by 7 percent, 10 percent and 12 percent, respectively.
“In line with confidence findings, it’s not surprising to see that consumers are planning to increase their spending across all industries measured, which will be encouraging to many retailers as they get ready for the end-of-year holiday season,” Dr. Venkatesh Bala, The Cambridge Group’s chief economist who contributed to the report, was quoted by Nielsen.
Observers hoping to see how consumer confidence has evolved over the past six months should read our report on Nielsen’s second quarter economic confidence study results.
For more insights, read the full Nielsen study here.