Sunday 5 July, 2020

Consumer confidence at record high

Loop file photo of consumers shopping ahead of the 2018-2019 school year.

Loop file photo of consumers shopping ahead of the 2018-2019 school year.

Consumer confidence in Jamaica is at a historic high, according to the latest Business and Consumer Confidence Survey.

A positive perception of the current and future job situation were the main drivers of this heightened confidence.

For the third quarter ending September, consumer confidence index stood at 172.6 points, up from the 159.1 points in the second quarter, according to the survey results which were presented on Tuesday.

The index for the review period represents the highest recorded since the survey first started 17 years ago.

With regard to the prospects for jobs in Jamaica, 10 per cent up of those surveyed - compared to seven per cent in the second quarter - were of the view that jobs were “plentiful”, while 41 per cent up from 37 per cent expect the job situation to improve in a year.

Analysis of the survey was done by Market Research Services Limited and presented by the company's Managing Director Don Anderson, who also said income expectations among consumers increased during the period.

Don Anderson, Managing Director of Market Research Services Limited

Income gains were anticipated by 50 per cent of those surveyed, up from 45 per cent in the second quarter.

“This represents a change over the last quarter’s survey results, which showed consumers as not being as confident about benefiting from the positive business climate that they observed in Q2,” the survey said.

Consumers’ assessment of the current business conditions also increased from 99 index points in the second quarter to 106 in quarter three. The proportion of consumers who assessed business conditions as being good grew by four cent points to 22 per cent.

“This has resulted in the large majority, 84 per cent, who had a positive impression of business conditions with 62 per cent considering it to be average or stable,” Anderson told the press briefing.

Business confidence

Unlike the consumers’ optimism, confidence among businesses was stable.

The business confidence index remained the same approximately 140 points in the third quarter of 2018.  

Firms’ expectations for economic growth however waned to an extent, with a smaller proportion of firms, 48 per cent compared to 64 per cent in the second quarter, reporting that they expect the economy to improve in the next year.

“It is noteworthy however that of the variables that make up the overall business confidence index, “expectations for the economy” was the only variable in which notable smaller proportion of firms reported that they expected improvement,” Anderson said.

The expectation of firms to exceed profit remained the same, but there was heightened expectation in financial prospects and profitability.

“Firms’ confidence in their planned internal strategies continued to be at the heart of the stability reported, “the survey said.

The Survey of Consumer and Business Confidence is published by the Jamaica Conference Board, an affiliate of the Jamaica Chamber of Commerce.

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