UF Economists: Florida Consumer Confidence Dips Slightly From Record

April 1, 1999

GAINESVILLE — Impending NATO military intervention in Yugoslavia did little to dampen consumer confidence in Florida, which dropped only slightly last month from its all-time high in February, University of Florida economists report.

The preliminary index for March dipped to 107, one point lower than last month’s 15-year record high, said Chris McCarty, survey director with UF’s Bureau of Economic and Business Research.

“Floridians think the good times will roll on,” said UF economist Dave Denslow. “The shares expecting their personal finances and the nation’s economy to improve during the coming year both reached record levels in March. Fifty percent of those surveyed expect their personal finances to improve over the next year, and 62 percent expect the national economy to continue to grow. Optimism is boosted by the state’s 4 percent gain in jobs over the past year, by the absence of inflation and by the soaring stock market.”

Despite job losses due to corporate mergers and restructuring, as well as continued recession and depression in Asia, Russia and Latin America, the U.S. economy remains robust, McCarty said.

“It appears that consumers still see no reason to react to financial problems internationally or to the possibility of increased involvement in the hostilities in the Balkans,” McCarty said.

The slight decline in Florida’s consumer confidence was due to lower optimism about expected national conditions over the next five years, McCarty said. That component fell from 93 in February to 89 in March. Perceptions of whether it was a good time to buy big- ticket items such as appliances and cars fell three points during this time, from 127 to 124.

These declines were offset by increased optimism about current and future finances. Perceptions of current finances compared with a year ago rose by two points, and the index measuring the expected finances a year from now rose by a point.

The bureau conducts the Florida Consumer Attitude Survey monthly. Respondents are 18 or older and live in households telephoned randomly. The preliminary index for March was calculated from 603 responses. Numbers for prior months are based on about 1,000 residents. The margin of error for the index is 3 percent.

Consumer confidence is designed to help predict buying patterns by measuring consumers’ mood toward buying. Although other economic indicators also are predictors of buying patterns, consumer confidence tends to be available sooner than those indicators.

Nationally, the Conference Board announced a one-point increase in its index in March.