Consumers are more confident in the economy than they’ve been in the previous 15 years, according to the Consumer Confidence Survey conducted by The Conference Board by Nielsen, a provider of information and analytics around what consumers buy and watch.
The Consumer Confidence Index increased in February to 114.8, up from 111.6 in January. Similarly, the Present Situation Index increased from 130 to 133.4 and the Expectations Index increased from 99.3 to 102.4.
In 1985, the index was set to 100, representing the index's benchmark. This value is adjusted monthly based on results of a household survey of consumers' opinions on current conditions and future economic expectations. Opinions on current conditions make up 40% of the index, while expectations of future conditions make up 60%.
“Consumer confidence increased in February and remains at a 15-year high,” said Lynn Franco, The Conference Board director of economic indicators. “Consumers rated current business and labor market conditions more favorably this month than in January.”
“Expectations improved regarding the short-term outlook for business, and to a lesser degree jobs and income prospects,” Franco said. “Overall, consumers expect the economy to continue expanding in the months ahead.”
Consumers’ assessment of current conditions held relatively steady as those who said conditions are good decreased slightly from 29% to 28.7% while those saying business conditions are bad also decreased from 15.9% to 13.2%.
Those who said jobs are plentiful decreased from 27.1% to 26.2% while those who said jobs are hard to get also decreased from 21.2% to 20.3%. And in the short term, those who said they are expecting business conditions to improve over the next six months increased from 22.9% to 24%, yet those who said they are expecting business conditions to worsen also increased from 10.8% to 11.1%.
Consumers were more optimistic about the labor market as those expecting more jobs in the months ahead increased from 19.7% to 20.4% and those expecting fewer jobs declined from 14.4% to 13.6%. And with the job increase consumers are also expecting higher wages as those who expect their incomes to increase rose from 18.1% to 18.3% and those saying they expect a decline in income decreased from 9.4% to 8.2%.
However, other measures of consumer confidence show that optimism slipped in February. While Republicans and Democrats continue to grow apart, Independents became more confident over the past three months. Overall, however, Americans are slightly less confident in February.