Improving Unemployment Figures Fail To Lift Financial Mood

The Consumer Report Index for November shows that the overall financial health of consumers is slowly improving, but some setbacks will make the holiday shopping season challenging. Employment is slowly but steadily growing again. New jobs outpaced the loss of employment slightly this month. Unfortunately, consumers sentiment and trusts is falling again, hitting 45.0 after peaking at 48.8 earlier this year. Consumer spending will likely stay guarded and relatively low this season unless shoppers experience a sudden change in sentiment. The Consumer Reports National Research Center explains that both wealthy and middle class consumer mood has soured.

The Sentiment Index directly charts the consumer’s financial health against last year’s figures. Consumer sentiment dropped to 45.0 after reaching 47.6 this October. Households above $100,000 and those below $50,000 saw the biggest effects from this drop. Higher class households recorded a drop from 61.4 around February of 2011 to 52.7 this month. Employment did climb to 50.6 and stay above 50 for the entire month. This was the first time since April of 2009 that the index was in the positive for all income groups. This shows that jobs are finally starting to become more available across the country and in all position levels.

The Trouble Tracker rose only .3 percent over October’s measure of 49.7. Credit card difficulties and medical bill payment issues did rise slightly, but didn’t have a big impact on the month’s score. Retail was down to 9.1 from 11.3 a month ago, but the next 30 days are expected to hit 11.1 again as holiday gift buying picks up. As consumers see the benefits of the improving job margins consumer confidence is expected to rise, off-setting the damper placed on spender by low consumer sentiment. Only time will tell how the November and December retail season provide for the country’s biggest retailers.

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