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AP |
Consumer confidence fell to a record low in December as the worst job market in 16 years hammered sentiment, the Conference Board said on Tuesday.
The Conference Board, a business research company, said its Consumer Confidence Index fell to 38.0 in December from a slightly downardly revised 44.7 in November.
The median forecast of economists polled by Reuters was for a reading of 45.0. Their 62 forecasts ranged from 40.0 to 51.1.
At the same time, business activity in the Midwest continued to shrink in December but at a less severe rate than expected, and input prices fell sharply, a report showed Tuesday.
"The further erosion of the Consumer Confidence Index reflects the rapid and steep deterioration of economic conditions that occurred in the fourth quarter of 2008," said Lynn Franco, director of the Conference Board's Consumer Research Center.
"The overall economic outlook remains quite dismal for the first half of 2009, and only a modest recovery is expected in the second half."
Chief among consumers' woes has been spiraling job losses in recent months.
Video: Analyzing Consumer Confidence data.
U.S. employers axed 533,000 jobs from payrolls in November alone, the most in 34 years, according to Labor Department data released earlier this month.
The Conference Board data reflected this, with its "jobs hard to get" index rising to 42.0 in December -- its highest since December 1992. That was up from 37.1 in November.
Not surprisingly, consumers also rated their present situation the worst in 16 years, with the index of this measure tumbling to 29.4 -- its lowest since April 1992 -- from November's 42.3.
Meanwhile, the Institute for Supply Management-Chicago business barometer rose to 34.1 from 33.8 in November. Economists had forecast the index at 33.0.
A reading above 50 indicates expansion while a reading below 50 indicates contraction.
The employment component of the index rose to 39.6 from 33.4 in November. Prices paid fell to 30.5 from 50.7 and new orders rose to 29.4 from 27.2.
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