Utah’s business landscape is rich with professionals who have le...Read More
Social Media and Employers: Friends or Enemies?
The Case for HSAs
Time to Show Up
Make a Move
In the Lab
Rent to Own
Back from the Dead
A Breath of Fresh Air
Travel & Tourism
Salt Lake City — The Zions Bank Consumer Attitude Index (CAI) was relatively unchanged, increasing 0.1 points to 96.2, from December to January, keeping the CAI at its highest level since its inception in January 2011. For comparison, this month’s national Consumer Confidence Index (CCI) increased 3.2 points to 80.7.
Although the Zions Bank CAI remained flat, substantial change in the two indices that compose the CAI indicate consumers are feeling more optimistic about the future. The Zions Bank Present Situation Index — an assessment of confidence in current business and employment conditions — decreased 6.6 points to 88.7, while the Zions Bank Expectations Index — an estimate of consumer confidence in the economy six months from now — increased 4.6 points from December to January and now sits at 101.2. When the Expectations Index moves substantially higher than the Present Situation Index, consumers are planning to spend more in the coming months and likewise expect the economy to improve. The 12.4-point difference between the two indices is the largest difference since June 2013.
For each of the past three years, the Present Situation Index has moved lower and the Expectations Index has moved higher or been unchanged following the holiday spending season. This is likely because consumer spending is highest in the holiday season, causing some consumers spending fatigue and making them hesitant to say current economic conditions are extremely positive. Concurrently, consumers are less apt to make major purchases following the holiday spending season: the percentage of Utahns likely to make a major purchase such as a stove or refrigerator in the next six months declined from 26 percent in December to 23 percent in January.
In the coming months, consumers in Utah most expect to see improvement in the labor market and with regard to personal earnings. Thirty-four percent of Utahns expect more jobs to be available six months from now, up nearly 10 percentage points month-over-month, and 31 percent expect their household income to be higher six months from now than it currently is, up from 26 percent in December. In addition, more Utahns are expecting improvement in their 401(k)s. Thirty-eight percent, up from 35 percent in December, believe $1,000 invested in their 401k is likely to be worth more than $1,000 in one year.
Gasoline prices have started to creep higher over the past few weeks, and this likely prevented the CAI from moving higher this month as gasoline prices and consumer attitudes tend to be inversely related. The percentage of Utahns expecting gasoline prices to move higher over the next year remained above 70 percent in January, and the percentage of Utahns expecting gasoline prices to drop decreased from eight percent in December to six percent in January. Those who expect gasoline prices to move higher believe prices will rise about $0.44 per gallon.
“Consumer attitudes remained high this month following a strong holiday spending season,” said Scott Anderson, president and CEO of Zions Bank. “While the Present Situation Index showed us that some consumers became slightly less optimistic about the current economic situation, the Expectations Index shows that consumers still have confidence in the trajectory of our economy.”