Americans are seeing some real improvements this month, with economic difficulties continuing to decline, an improved retail picture, and modest gains in employment, according to the Consumer Reports Index for October.
The Consumer Reports Trouble Tracker Index has declined for four straight months and now stands at 50.5, down from 53.7 the prior month and down from its recent high of 63.5 in June. Positive developments were led by a decline in consumers unable to afford medical care or medications, to 12.7% from 13.6% in September; and a drop in the proportion of Americans who missed a payment on a major bill (8.7%), down from the prior month (9.3%). On the downside, in the past 30 days, 3.0% reported that they have missed a payment on their mortgage, up from 2.4% in September.
Consumer Reports Past 30-Day Retail Index for October is 9.9, on par with the prior month (9.8), but down from a year ago (10.4). There was a slight increase in consumer purchasing for personal electronics (23.2%, up 1.8% points), and small appliances (18.5%, up 1.9% points). Consumer Reports Next 30-Day Retail Index stands at 7.4, down from the prior month (7.6), capping three months of decline since July (8.5). Small appliances posted a slight gain in October (11.5) from the prior month (10.6).
The Consumer Reports Employment Index is up slightly this month to 49.5 from 49.1 in September. Overall labor force activity is modest, with fewer Americans claiming to have started a new job in the past 30 days (5.7%), than those that lost their job (6.7%). Job losses (6.7%) were largely unchanged from the prior month (6.9%), while job gains were up slightly (5.7%) from September (5.0%). The employment index remains in negative territory, with job losses outpacing gains.
Despite improvements, confidence remains low and stress is up. The Consumer Reports Consumer Sentiment Index is currently at 44.8. Sentiment has doggedly refused to enter positive territory (over 50) since it was first measured by the Consumer Reports Index on October 5, 2008 and stood at 45.3. The Consumer Reports Stress Index is up in October to 63.2 from 60.1 the prior month, and is at its highest level since April 2010 when it hit 63.8.
“Americans appear to be experiencing less financial woes, but the key factor continuing to depress consumers is weak employment growth,” said Ed Farrell, a director of the Consumer Reports National Research Center. “The lack of real improvement on the jobs front will dampen any meaningful improvement in economic activity.”
The Consumer Reports Index report, available at www.ConsumerReports.org , comprises five key indices: the Sentiment Index, the Trouble Tracker Index, the Stress Index, the Retail Index, and the Employment Index.
