HIGH POINT, N.C., Mar. 27, 2013 – Confidence in the economy is slipping among North Carolinians, according to the latest HPU Poll’s Consumer Sentiment Index.
The index, which is based on HPU Poll data, fell to 72.0 from 81.9 this past fall. That’s the lowest recording since September 2011, when the index was at 59.9. The new reading was driven by North Carolinians’ declining assessments of their future financial situations and increasingly negative predictions about future economic conditions in the country as a whole.
The index itself comprises five separate questions that each ask respondents about a different aspect of how they view the U.S. economy and their own personal finances. Some findings for individual questions show why the overall index registered a decline, reflecting growing pessimism among consumers about the national economy and their personal finances:
• More North Carolinians, 22 percent, expressed concern that they would be worse off financially a year from now. In Sept. 2012, only nine percent thought they would be worse off – a significant increase of 13 percentage points in just a few months.
• Thirty-seven percent of North Carolina residents interviewed in the current survey said they expected bad times for business conditions in the country as a whole. That is the largest percentage the survey has found since September 2011, when 59 percent of people responding to the poll said they expected bad times.
• Most North Carolina residents, 57 percent, say it is more likely that there will be widespread unemployment or depression in the economy rather than continuous good times over the next five years or so. This is the most pessimistic set of responses the HPU Poll has recorded since September 2011 when 60 percent of respondents said they thought widespread unemployment or depression was more likely.
“This new set of numbers indicates that even if a recovery is underway, North Carolinians’ perceptions and feelings about their own experiences have not caught up to it,” said Dr. Sadie Leder, associate director of the HPU Poll. “This has implications for politics and government, as well. People tend to be less favorable toward officials in power when they feel less optimistic about the direction of the economy.”
The index models its questions on the national Thomson Reuters/University of Michigan Surveys of Consumers (http://www.sca.isr.umich.edu/). The HPU Poll plans to field the questions at least once per semester in order to gauge consumer feelings on economic conditions.
The HPU Consumer Sentiment Index is based on five questions used for the Thomson Reuters/University of Michigan Surveys of Consumers (http://www.sca.isr.umich.edu/). The High Point University Phillips School of Business and directors of the HPU Poll consulted with the directors of the Surveys of Consumers and other state survey organizations that calculate similar state-wide indexes before it first asked the questions in 2010.
The Consumer Sentiment Index is based on five questions that ask respondents their current financial situation compared to a year ago, likely financial situation a year from now, business conditions a year from now, general economic trends five years into the future and whether now is a good time to purchase major items for their homes. (A memo with current and past Consumer Sentiment Index calculations, question wordings and demographics are available here: http://acme.highpoint.edu/~mkifer/src/23memoz.pdf
The most recent survey was fielded by live interviewers at the High Point University Survey Research Center calling on March 17–21, 2013. The responses from a sample of all North Carolina counties came from 548 adults with landline or cellular telephones. The Survey Research Center contracted with Survey Sampling International to acquire this sample. The survey has an estimated margin of sampling error of approximately 4.2 percentage points for these North Carolina residents. The data are weighted when appropriate toward population estimates for cellular and landline telephone use, age, gender and race. In addition to sampling error, factors such as question wording and other methodological choices in conducting survey research can introduce additional error into the findings of opinion polls.
Further results and methodological details from the most recent survey and past studies can be found at the Survey Research Center website at http://src.highpoint.edu/
Dr. Martin Kifer, assistant professor of political science, serves as the director of the HPU Poll, and Dr. Sadie Leder, assistant professor of psychology, serves as the associate director of the HPU Poll.