Consumer confidence continues to be strong in retail sector

The gain in confidence was driven by improvement in consumers’ views of both the present situation and expectations.

By ·

As the 2018 Retail Supply Chain Conference concludes this week in Phoenix, leading industry indicators point to continued consumer confidence.

“The Conference Board's consumer confidence index unexpectedly surged 6.5 points (5.2%) to 130.8, the highest level since November 2000,” said James Bohnaker, Associate Director, U.S. Macro & Consumer Economics, IHS Markit.

He added that the gain in confidence was driven by improvement in consumers’ views of both the present situation and expectations. 

“The labor index (percentage of respondents who think that jobs are plentiful minus the percentage who think jobs are hard to get) increased 3.8 points to 24.7%. The percentage of respondents expecting higher income six months from now rose 3.2 points to 23.8%. Both were the best since 2001, consistent with the tight labor market with unemployment at 4.1% and likely headed lower,” he said.

According to Bohnaker, many consumers started seeing additional money in their paychecks this month, so the rise in confidence is no surprise. Sustained improvement in income growth—due to more hiring, wage gains, and the tax cuts—will keep confidence elevated over the next couple years.

“Recent financial market volatility was resolved early in February, so that was likely brushed off by most respondents. However, a return to more frequent episodes of market turbulence could cause some swings in confidence,” he said.

Analysts maintain that The boost in consumer confidence is supportive of IHS Markit’s  February real consumer spending growth forecast of 0.3%.

Naveen Jaggi, President of Retail and Capital Markets for JLL, told Logistics Management that this confidence has industrial real estate implications for shippers.

“Strength in labor market and the recent tax cuts propelled consumers to remain positive, despite the recent volatility of the financial markets,” he said. “This bodes well for retailers as most consumers found extra discretionary income in their pay checks.

Jaggi also noted that the recent market volatility would only potentially impact the luxury sector as those consumers have more income tied up in the markets.

“There would need to be sustained periods of negative news coming from the markets to impact most retail sectors,” he said.

About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [ protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.

Latest Whitepaper
Rules of Origin Really Do Rule
Inputs Make the Outputs: How Rules of Origin Really Do Rule
Download Today!
From the July 2019 Logistics Management Magazine
While trade tensions with China have already disrupted many U.S. supply chains, analysts suggest that a recalibration of shipping and sourcing destinations is long overdue. Emerging markets might finally live up to their potential and keep globalization on track.
2019 State of Logistics: Third-party logistics (3PL) providers
2019 State of Logistics: Air cargo
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly newsletter!
Latest Webcast
Leveraging 3PLs for Future Shipper Gains
In this webcast, Evan Armstrong, president of Armstrong & Associates offers logistics and supply chain managers the industry’s most comprehensive overview of the state of domestic and global third-party logistics arena.
Register Today!
State of Logistics in 2019: What’s next?
Tight capacity, high rates, rapid e-commerce growth and a booming economy fueled an 11.45% rise in...
Got labor? How supply chain companies are recruiting talent during a labor crunch
How are companies faring in the race to recruit and train high-level supply chain talent in a market...

35th Annual Salary Survey: Compensation matters more than ever
While job satisfaction remains the primary reason for today’s logistics managers to stay with one...
2019 Rate Outlook: Pressure Builds
In 2019, the world economy will enter a third straight year of broad-based growth, but many...
details by link

c4 picasso

инфракрасный градусник купить