By MARY PATRICK
Consumer sentiment in the United States is at the highest level it has reached in six years, according to the latest Thomson Reuters/University of Michigan poll.
The latest survey shows that the overall consumer index climbed to 85.1 in July, up from 84.1 in June. Consumer sentiment has not been that high since July 2007.
In a statement accompanying the release of the latest information, survey director Richard Curtin said, “This high level of confidence points toward a continued expansion of consumer spending in the year ahead.”
Lower income households actually had a more optimistic outlook than higher income households, according to the survey.
A rise in consumer sentiment is good news for those working in the retail industry or any area of the economy where goods are sold directly to consumers – as well for any students studying for careers in those areas.
Part of the reason for the better sentiment is an improvement in job gains that started in the second half of 2012, according to Bloomberg. The jobs outlook continues to improve. Numbers from the Department of Labor indicate that the number of jobs in the United States increased by an average of 202,000 a month in the first six months of 2013, compared to an increase of 180,000 a month in the last six months of 2012.
Consumer confidence is also being bolstered by an increase in personal wealth that has occurred with rising stock prices and an upswing in property values.
“The labor market’s better, you’re seeing home prices rise, you’re seeing equity prices rise, so there are a lot of things out there to be positive about,” Brian Jones, a senior U.S. economist at Societe General, told Bloomberg. “If you think about the things that drive consumer confidence, they should be rising as well through the end of the year.”
According to the Thomson Reuters/University of Michigan survey, households with younger workers reported an increase in income while households with older, middle- and upper-middle class workers showed an increase in assets (likely tied to stock and property increases). The survey indicated that attitudes were becoming more positive for large purchases, such as cars and homes.
