Florida’s consumer confidence dipped to 75, down one point from a revised reading of 76 in December, according to a monthly University of Florida survey.
Consumer confidence has been more or less flat since the November election because of improving economic conditions and Congress’ delay handing the federal government’s fiscal problems, said Chris McCarty, director of UF’s Survey Research Center in the Bureau of Economic and Business Research.
January may have seen a modest dip in confidence, but there had been a strong possibility of a big decline in January if the fiscal cliff in Washington had not been averted, McCarty said.
“So far there have been no changes to Social Security and Medicare, which is reflected in an increase in confidence among seniors by three points,” McCarty said. Other mixed economic trends were also under way. Florida’s unemployment rate declined again in December by one-tenth of a percent to 8 percent, only slightly higher than the national 7.8 percent rate.
“Although much of the drop in unemployment in 2012 was due to a decline in the labor force, there have been some real gains,” McCarty said. “For example, across the U.S. jobless claims fell unexpectedly last week, another indication that in the U.S. and Florida the economy is on the mend.”
The stock market also hit a post-recession high. The housing market is improving, too.
“Some areas of Florida are actually experiencing shortages of existing homes, leading to increased construction,” McCarty said. In fact, Floridians saw the median price of a single-family home increase to $154,000 in December, almost matching its 2008 value. Though overall housing prices remain far below their peak in June 2006, they have increased substantially since bottoming out, thus helping many Florida homeowners who were “under water in their mortgages,” McCarty said. Gas prices are rising but may fall as U.S. supplies improve.
Despite these positive indicators, consumer confidence may decline in February as consumers begin to notice the effect of a return to pre-stimulus payroll tax levels, a change in withholding from 4.2 to 6.2 percent, McCarty said.
Conducted Jan. 13-24, the UF study reflects the responses of 433 individuals, representing a demographic cross section of Florida.
