Utah consumers remain confident, report reveals
The optimism of Utah consumers edged down in January on lower confidence about job growth in 2012 but was still higher than in the same month of last year, according to a Zions Bank report released Tuesday.
The bank's Consumer Attitude Index fell to 79.8, down moderately from December, when the index surged to 81.9 its highest point in 2011. Nationally, the U.S. Consumer Confidence Index, fell by 3.7 points, to 61.1, in January after two straight months of big gains, the Conference Board said.
Zions launched the Utah index in January 2011. A reading of 70 or below suggests slow economic growth. On the other hand, 90 or higher indicates strengthening.
Although the Utah index pulled back, the change was too small to be considered significant, said Randy Shumway, CEO of The Cicero Group/Dan Jones and Associates, which prepares the monthly confidence measure for Zions.
"The real message has nothing to do with the point change and has everything to do with the boost of confidence in December [which] has been maintained in January. This is very positive," Shumway said.
Shumway said he would have been worried about the pace of the recovery if the index had fallen more than five points. A lesser change is statistically insignificant, he said.
"We are seeing a steady but slow return of confidence," he said. "Remember [that] we are rebounding from the longest, deepest economic recession since the Great Depression. The road will be slow and it will be bumpy, but what you see ... is that the last 12 months has been a slow, steady rebound, and I think you will continue to see that in 2012."
Much of the downward revision of confidence was centered on worries that more than 80,000 Utahns are still unemployed, even though the state's jobless rate has receded from its 2011 highs of 7.6 percent in January and August (to 6 percent in December), and that 36,000 jobs have been created in the past year. According to the survey, many consumers are less certain about job growth than they were in December. The data show 16 percent of consumers believe fewer jobs will be available in the next 12 months. In December, 14 percent thought more jobs would open up. Just 7 percent believe jobs are plentiful right now, according to the survey.
Despite the decline in job confidence, consumers are more optimistic about business conditions and household income, the report said.
"I think a lot of small businesses saw an increase [in retail sales] last year, starting in November, and it carried all the way through the first of January," said Anne Holman, general manager of The King's English, an independent bookstore in Salt Lake City. "Our sales are up 20 percent over the year before."
The growth allowed the store to add a full-time employee in November, bringing payroll to 25 people, including seven full-time workers.
"We operate on a razor's edge, that's for sure. But we've seen an uptick in our online sales, and also things that are a little harder to measure, life Facebook fans and Twitter followers. You don't know how that affects sales, but based on Christmas, [they] must be working," she said.