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Utah consumers continued to gain confidence in the state’s economy during the month of July—a trend showcased well in local movie theaters.
According to the most recent results of the Zions Bank Utah Consumer Attitude Index, the index increased by 6.6 points to 104.9 from June to July, landing at an all-time high. The Utah Consumer Attitude Index corresponds to the national Consumer Confidence Index, which increased 4.5 points to 90.9 from June to July.
Randy Shumway, CEO of the Cicero Group, the organization responsible for compiling the Consumer Attitude Index for Zions Bank, said this increase is very good for the state because consumer spending drives about two-thirds of local economic activity.
“Twenty-nine percent of Utahns believe that more jobs will be available in their area in the next six months, and 34 percent believe their household income is going to rise over the next six months,” he said. “A total of 61 percent believe the value of their home will be higher in 12 months than it is today.”
Shumway said if a person feels confident in the economy, they’re more likely to spend money on things like going to the movies.
“That type of spending creates more jobs for people, which is really good for the economy,” he said. “Utah today has the second-lowest unemployment rate in the country, second only to North Dakota, at 3.5 percent. Nationally, the unemployment rate is down to 6.1 percent.”
Blake Anderson, president of Larry H. Miller Megaplex Theatres, said he’s seen this trend at his theaters across the state, where there are typically more than 100 employees working at each location.
“We usually have stacks and stacks of applications coming into Megaplex, and we still see that, but I can tell you it’s gotten a little harder in this economy [to hire people],” he said. “It’s good and bad. It’s good for the state and the economy, but can be harder for us as employers.”
Anderson also said year-over-year revenue comparisons have been tough this year because of an “interesting evolution that has taken place.”
“We’re seeing some of these big blockbuster movies being released throughout the year instead of just piled into one month,” he said. “That has been a blessing for all of us. In previous years, all the big blockbusters would come out around Memorial Day and close around the Fourth of July.”
This trend has helped Megaplex maintain its staff better, rather than hiring extra people during the summer movie rush, and has been better for attendance as well, because people are able to spread out their movie-going experience, Anderson said.
“It makes for some interesting year-over-year comparisons,” he said. “This July isn’t as strong as last July, but no one is hitting the panic button yet because we believe August will be quite a bit higher than the previous August.”
Anderson said movie attendance is interesting to watch. Since the industry’s banner year in 2002 thanks to popular movies like Star Wars, Harry Potter and Lord of the Rings, attendance has stayed relatively flat while revenues continue to grow.
“That’s a little concerning because we want to continue growing attendance,” he said. “We’re looking for ways to do that. During the Great Recession people who were avid moviegoers could no longer afford to take their families out, so they got out of the habit of going to the movies. We’re doing everything we can to bring that group back.”
Anderson announced that the 178-screen theater chain plans to begin $5 Tuesdays next week, where every movie all day is just $5 a ticket. The theaters will also sell discounted concessions on Tuesdays.
“By doing so, we hope people who haven’t been able to afford the movies will be able to come back and realize movies are still one of the most affordable and entertaining opportunities that exist out there,” he said.
Anderson said the future is bright for Megaplex Theatres, which is in part due to the improving economy. The company is currently constructing a new theater in Utah County at the former Geneva site in Vineyard, and recently announced a $1 million renovation its Gateway Mall theater. Anderson also announced that a new theater will be built in Salt Lake City, though he cannot disclose the location or timeline until Friday.
The Utah Consumer Attitude Index compares to the national Consumer Confidence Index released the same day by the conference board. The indices gauge the degree of optimism for the economy that consumers are expressing through their activities of savings and spending. National comparison enables consumers, businesses and policymakers in to identify key economic trends unique to Utah.