Cautious Consumers Still Cutting Back Despite Increased Confidence
Written by Ken Gaebler
Consumers are continuing to cut back on spending, despite slightly increased confidence levels.
The recession continues to bring bad news for small businesses, who may have to wait a little longer to see business pick up, according to recent data from Harris Interactive.
The latest Harris Poll found that 63 percent of Americans say they are spending less, and 33 percent say they are using their credit card less.
Credit card cool-offs were highest among middle aged and "upscale" Americans who earn more than $75,000.
A recent Mint.com survey posted similar results, reporting a 17 percent decrease in overall spending in the first quarter of 2009.
Though consumers may not have let it influence their spending habits yet, their confidence levels in the economy have slightly increased. The Reuters/University of Michigan Survey of Consumers recently reported that consumer confidence rose 2.1 percent since May, landing 1.8 percent higher than the median expectation from economists polled by Reuters.
"Over the past four months, sentiment has improved moderately, suggesting that consumers' attitudes about the economy are improving," Steven Wood, chief economist at Insight Economics, told Reuters.
Wood cautioned that it may take a while for the increased confidence to translate into increased spending, telling the news provider that, although consumers are "no longer shell shocked," they remain "remain very cautious."
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