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Consumer Confidence Sputters Along in Connecticut; Consistent Progress Remains Elusive

Three in four Connecticut residents believe that overall business conditions in the state will be the same or better six months from now, the highest total in a year, and eight in 10 say the employment situation in the state will be the same or better in six months.

Twenty-one percent of respondents in a new quarterly survey said overall business conditions were better in Connecticut now than six months ago, up from 16 percent last quarter, while 27 percent said conditions were worse, down from 35 percent. Just over half (51%) say business conditions are unchanged, and virtually the same percentage (52%) don’t expect business conditions to change in the next six months.

Overall, the public’s view of economic and employment conditions in the state is not trending strongly in either direction, for better or worse, according to the latest quarterly InformCT Connecticut Consumer Confidence Survey, and numerous indicators are either steady or declining slightly.

Two years ago, more than one-quarter believed that the employment situation would get worse over the following six months. That has now dropped to less than one-fifth. Yet nearly twice as many residents don’t believe that the economy is improving as believe that it is. A total of 24 percent believe the state economy is improving, while 45 percent disagree. That gap has widened from the 29-44 split a year ago. Respondents were split almost evenly on concerns that they or their spouse or partner’s job is in jeopardy, with one-third worried, one-third not concerned, and one-third not sure.

InformCT is a public-private partnership that provides independent, non-partisan research, analysis, and public outreach to help create fact-based dialogue and action in Connecticut. The survey, conducted quarterly since 2015, is administered by researchers from the Connecticut Economic Resource Center, Inc.

Consumers are increasingly reluctant to make major purchases, seen as an indicator of lack of confidence in the economy, according to the survey. For the third consecutive quarter, the percentage of residents who say they are likely to refinance their home or purchase a new home, as well as those indicating they are planning to take a vacation outside of Connecticut, has declined. The percentage who say it is very unlikely that they will purchase a car in the next six months has climbed above 50 percent for the first time in more than a year. In addition, the percentage who responded that it is very unlikely they will make a major consumer expenditure for furniture for some other product in the next six months has climbed for three consecutive quarters, now at nearly 4 in 10 residents.

“Consumer confidence mirrors Connecticut’s economy,” said Alissa DeJonge, Vice President of Research at the Connecticut Economic Resource Center, Inc. “While the national economy has strengthened, we’re still not seeing a solid pick-up yet.”

About half of state residents continue to consider Connecticut a good place to live and raise a family. That percentage in the latest survey was 49 percent, compared with 29 percent who disagree. Those numbers virtually haven’t budged for five quarters, hovering around 50 percent who agree and just under 30 percent who don’t. The remainder are either neutral or unsure.

Regarding personal finances, residents continue to be more upbeat, with 43 percent saying they expect to be better off six months from now, and only 15 percent expecting to be worse off. Those numbers have been relatively consistent during the past year (42%-16% in Q1 2017).

State residents remain unconvinced, however, that they will have enough money to retire comfortably. Nearly half (49%) don’t think so while one-quarter (25%) do. Again, those numbers have changed only slightly during the past year. In the first quarter of 2017, the split was 43-29.

Regarding the affordability of health insurance, about 6 in 10 residents continue to be concerned. Only about 20 percent say they are not concerned. Those percentages have been relatively constant, between 50 and 60 percent expressing concern about being able to afford health insurance, since the quarterly survey began in 2015.

The online survey of 505 state residents, conducted in April 2018, has a margin of error of 4 percent.