”Survey says” looks at various rankings and scorecards judging geographic locations while noting these grades are best seen as a mix of artful interpretation and data.
Buzz: California consumers have not been this depressed in four years.
Source: My trusty spreadsheet looked at August’s California consumer confidence index to see how all the economic news translates to shopper sentiment and compared those measurements with US optimism. The index is a key barometer for business owners and political policymakers in a big election year.
The last time California’s consumer confidence index was lower was May 2020 – smack in the middle of the pandemic lockdown’s economic muzzle. It’s also been a rough summer this year, according to this benchmark, with its yardstick of consumer psyche off 17% in two months, down 24% in a year – and 26% below pre-coronavirus 2015-19’s average results.
Two-plus years of the Federal Reserve’s elevated interest rates have clearly cooled the financial enthusiasm of Golden State shoppers. Widespread layoffs and rising unemployment have seemingly overshadowed the good news: continued hiring, generous raises and rising stock and home prices.
Nationally, consumer skittishness is far milder: a 6% dip in two months and a 5% decrease over 12 months puts it 10% below 2015-19.
Let’s ponder the two index slices that show steep drops in Californians’ view of today’s economy and future finances.
California’s “present situation” index is off 22% in two months, off 32% in a year, and off 32% vs. 2015-19. That a sharp contrast to the nation’s 1% dip in two months, 8% slide in a year, leaving it 6% below 2015-19.
The Golden State’s “expectations” measurement is off 11% in two months, off 16% in a year, and down 19% vs. 2015-19. Nationally, expectations are actually up 13% in two months but off 1% in a year and 15% below 2015-19.
Even “red” states, including California’s two top economic rivals, have mixed economic views.
Texas consumer confidence is up 20% in two months, up 7% in a year, but off 11% vs. 2015-19. In Florida, optimism is down 5% in two months, and there’s been a 12% decrease over 12 months, with pysche is 16% worse than 2015-19.
Consumers, especially in California, don’t seem to like inflation nor its medicine.
The Conference Board’s broader US poll seeks feedback on prices and financing costs. Shoppers nationwide apparently to see a fix ahead in the next 12 months, at least according to August’s polling.
The median forecasted inflation rate from consumers was 4% – the lowest projection since March 2020. And 32% of those polled see falling interest rates – the highest level since April 2020.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
