Consumer Reports’ Consumer Sentiment Index rose slightly from 46.2 in June to 48.5 in July but remained in negative territory, as the stagnant job market is making consumers cautious about spending.
“The economy is treading water and really hasn’t shown any momentum toward recovery,” said Ed Farrell, a director at Consumer Reports National Survey Research Center. “Consumers remain cautious, especially households with income less than $50,000, who have been hurt the worst and face the biggest stresses regarding jobs, unpaid bills and healthcare access and affordability.”
The Consumer Reports Employment Index remained stagnant at 50.8, up from 50.0 the month before, as the number of jobs being lost equaled the number of jobs being created. The U.S. Bureau of Labor Statistics reported the unemployment rate rose to 9.2% in June.
“The job market is one of the biggest impediments to an economic recovery, as it weighs on consumers and has a large overhang on the U.S. economy,” Farrell said. “Poor hiring depressed retail performance in June and is also expected for the rest of July. Last month’s retail index was the weakest since October, and planned purchases are anemic compared with the past few months.”
The Consumer Reports Stress Index, at 59.4, remained on par with June’s reading of 59.9, but the Consumer Reports Trouble Tracker rose from 48.6 in June to 50.6 in July, indicating that people are facing more money problems than the month before.