Consumer sentiment, as measured by the Consumer Reports Trouble Tracker Index, remains in negative territory in May for the second consecutive month, with consumers worried about slow job growth and news of the economic recovery stalling.
Underlying the index, nearly one-third of Americans, 31.9%, said they face one or more financial difficulties, up from 27.2% the previous month.
The Consumer Reports Past 30-Day Retail Index is at 12.0, unchanged since April, and the Consumer Reports Next 30-Day Retail Index, reflecting planned spending for June, is at 9.0, remaining flat since January. However, 20% plan to purchase personal electronics in June, up from 14.1% in May, and plans to purchase major home electronics is at 11.2%, up from 9.6% the prior month.
The Consumer Reports Employment Index is at 50.0, indicating an economy that is creating as many jobs as it is shedding. In the past 30 days, 5.4% have started a new job, down from 6.7% the month earlier. Similarly, 5.3% lost a job in the past 30 days, up from 4.5% the prior month.
“The weakening employment index is one of the most troubling signs this month,” Farrell added. “A lack of job growth has been a serious impediment to the recovery for the past two years. Just two months ago it was looking promising, but a return to stagnation has the potential to derail the recovery.”s
“The recovery may not have stalled, but consumers are thinking it’s on the brink,” said Ed Farrell, a director at the Consumer Reports National Survey Research Center. “They are more cautious, feeling more stress and are experiencing more financial difficulties than they have been in the past few months.”