Concerns About Economy, Slowing Growth Highlighted
According to the latest preliminary results from the University of Michigan’s monthly Surveys of Consumers, in September overall US consumer confidence weakened due to concerns about slowing US growth and uncertainty in the global economy. The Index of Consumer Sentiment fell to 85.7 for August, down from August’s level of 91.9, and the lowest so far in 2015. Further, Current Economic Conditions fell to 100.3 for the month from 105.1 in August, and the Index of Consumer Expectations declined to 76.4, from 83.4 in August. Analyzing this month’s results, Surveys of Consumers chief economist Richard Curtin suggested consumers “still anticipate a weaker domestic economy due to the global slowdown and are less optimistic about future growth in jobs and wages than they were a few months ago.” However, there were some positives, as higher employment coupled with declines in consumer goods and services prices mitigated losses of “household wealth.” Curtin projected that current consumer spending will likely “persist in the year ahead,” but that recent events might prompt “a heightened attentiveness by consumers to potential negative developments.” The Hill suggested such recent events include global stock market volatility in August, led by upheaval in Chinese policies that led to yuan devaluation. The Hill also noted results of a separate poll issued by Thomson Reuters/Ipsos on Thursday that showed similar results for September, with consumer confidence declining from 54.2 in August to 53.9 in September, primarily as a result of stock market volatility.
What This Means For Small Businesses
Consumer confidence is key to small businesses across the US, who rely on positive consumer moods to generate continued revenue and keep expanding. When US consumers indicate concerns about the state of the overall economy, small businesses may suffer declines in revenues that could damage their bottom lines.
NFIB previously noted its August Small Business Optimism Index results, which also reflected waning confidence in light of economic uncertainty.
Note: this article is intended to keep small business owners up on the latest news. It does not necessarily represent the policy stances of NFIB.