Consumers May be Losing Confidence as Christmas Nears

Consumers May be Losing Confidence as Christmas Nears

Consumers May be Losing Confidence as Christmas Nears

November’s holiday spending came out strong, but many consumers are losing their confidence with new reports showing that employment numbers remain low and other financial problems rise says Consumer Report’s December Index. Details from this report show that November spending was up over the previous month, as well as last year’s November. However, the report’s information about consumer’s planned spending during December is lower than the same month last year.

Personal electronics in particular have shown lower than expected sales this holiday season. Experts say that these low spending figures are caused by a lack of consumer confidence in the economy’s recovery. Consumer spending was increasing for the last five months, according to monthly reports from Consumer Reports, but financial difficulties like job loss and bill payment problems rose slightly for consumers this month. Loss of health care coverage and the inability to pay major bills other than mortgage payments was reported as the most common financial troubles consumers are facing at this time, and both have risen since last month.

The rate of new job losses has also risen since June, but is at about the same level as this time last year. Consumer sentiment remains low due to these factors, with even the most optimistic groups like consumers with incomes over $100,000 a year only showing 55% of the respondents feeling optimistic about the economy and their future spending abilities. Despite this, the stress levels reported from consumers during this holiday season is 3% lower than last year’s figures.

Some industries have seen significant rises in sales this holiday season over the lackluster results of the rest of the year. Small and major home appliances lead with a 5% increase over the previous month. Home electronics sales also increased this November and should still continue to rise in December.


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