Consumers’ assessment of current conditions deteriorated sharply in December, the Conference Board reported.
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U.S. consumers’ outlook on the economy darkened this month as coronavirus cases climbed nationwide and local governments imposed new restrictions, according to survey data released Tuesday.
The Conference Board, a private research group, said its index of consumer confidence dropped to 88.6 in the first two weeks of December, from a revised 92.9 in November.
“Consumers’ assessment of current conditions deteriorated sharply in December, as the resurgence of Covid-19 remains a drag on confidence,” said Lynn Franco, senior director of economic indicators at the Conference Board. In particular, respondents grew more pessimistic about the labor market, with the share of consumers saying jobs are “plentiful” falling to 21.8% this month from 26.3% in November.
“Overall, it appears that growth has weakened further in [the fourth quarter], and consumers do not foresee the economy gaining any significant momentum in early 2021,” said Ms. Franco.
Tuesday’s report comes amid signs that the U.S. economic recovery is losing steam. Initial claims for jobless benefits, a proxy for layoffs, increased in the first two weeks of December. The 885,000 new claims filed in the week ending Dec. 12 was the highest level for weekly claims since September. Private-sector data indicated the number of job openings slipped in early December.
Retail sales fell 1.1% in November from a month earlier, the Commerce Department said last week, the second straight month of decline.
Some state and local governments have put in place new restrictions this month to combat the virus, though most limits have been less strict than those imposed in the spring.
Data from private firms signal a pullback in consumer spending on services that require proximity among people. The volume of seated diners tracked by OpenTable, a restaurant reservation platform, is hovering at its lowest level since June. Google data on people’s movements shows trips to retail stores and restaurants are at their lowest levels since June, not counting a drop in activity around the Thanksgiving holiday.
The U.S. seven-day moving average of new Covid-19 cases sat at 215,500 as of Monday, according to a Wall Street Journal analysis of Johns Hopkins data—down slightly from the all-time peak hit last week, but more than three times the rate at the peak of the summer surge. The U.S. averaged more than 2,650 deaths a day in the past week. Nearly 115,000 people were hospitalized with the disease as of Monday, according to the Covid Tracking Project, higher than the peaks of previous surges in April and July.
This month’s consumer confidence data is based on survey responses collected Dec. 1-14.
Write to Gwynn Guilford at [email protected]
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