Consumer sentiment extended its streak of weekly gains to seven last week, according to the latest report from Morning Consult. Based on the firm’s daily survey of some 7,500 U.S. adults, overall consumer sentiment reached an index score of 111.8 for the week ended December 1. The 52-week high index was posted on April 29 at 112.6, and the 52-week low of 104.5 was seen on January 21.
The gap between the index’s component scores continues to narrow, a development that Morning Consult noted that “[t]his week’s data provides the first indication that consumers are more confident now than they were during the first two weeks of November.” The current conditions component of the overall sentiment score rose by 0.9 points last week to 111.3. The future expectations component rose 0.3 points to end the week at 112.0.
According to Morning Consult, while financial markets are trying to figure out what’s going on in the U.S. manufacturing sector, “consumers do not believe manufacturing weaknesses will affect the broader economy.”
The firm goes on: “Compared to last month, more consumers believe that they are better off financially than they were [at] this time last year and more expect to be better off 12 months from now than they are currently. These two measures signal that consumers believe U.S. labor markets are and will remain strong.”
Morning Consult asks the same questions of its survey respondents as does the University of Michigan’s twice-monthly Survey of Consumers. The difference is in the number and method of the survey. The Michigan sentiment index is based on 600 telephone interviews with U.S. adults, while Morning Consult’s results are based on an ongoing survey comprising 7,500 daily interviews and 210,000 monthly interviews, all conducted online.
The survey breaks down the data it collects by some key demographic groups. Here are some of the results of that breakdown.
Households with income of less than $50,000 annually posted an overall sentiment score of 106.3 last week, up 0.6 points from the previous week and second only to a sentiment increase among households with income between $200,000 and $250,000 of 1.6 points. Overall sentiment among households with incomes above $250,000 fell by 2.4 points to 129.4.
Overall sentiment gained an index point to come in at 118.2 among survey respondents with less than a college degree. Respondents with a college degree or some post-graduate education both posted small declines in overall sentiment.
By industry sector, the construction industry posted the largest week over week gain, up three points to 127.8. Sentiment among manufacturing workers was down two points to 122.7, and public administration worker sentiment tumbled by 14.7 points to 103.2.
Top executives posted a 4.8 point jump in overall sentiment for a score of 122.6. Sentiment among production, operations or logistics businesses with between 101 and 500 employees fell by 6.1 points last week to 119.6.
Looking at responses to questions about current economic conditions, respondents who earn less than $50,000 posted an increase of 0.6 points for an index score of 103.7, and those who earn between $50,000 and $100,000 added 1 point to lift their index score to 120.4, a 52-week high.
Manufacturing workers remain wary of the current economy, dropping their index score by 1.6 points to 121.5 while construction workers are the most upbeat, raising the score by 4.5 points to 123.7.
Company executives are more upbeat about current conditions, raising their index score by 5.2 points to 120.8, just 0.1 points short of the 12-month high.
For all the upbeat news, when asked about 12-month expectations for their personal finances, nearly every age and income cohort reported a lower index score than in the previous week. The most downbeat were those who earn more than $250,000, who chopped 6.8 points to lower their index score to 134.4.
The November employment situation report is due Friday and analysts are looking for nonfarm payrolls to rise by 180,000 compared with October’s increase of 128,000. The unemployment rate of 3.6% is expected to remain the same, and manufacturing payrolls are expected to bounce back from a decline of 36,000 in October to growth of 20,000 in November. Average hourly earnings are expected to rise by 0.3%, and the average workweek is expected to remain at 34.4 hours.
Also on Friday, the University of Michigan is scheduled to release its preliminary report on consumer sentiment for December. The consensus estimate from economists calls for an overall sentiment index of 96.9, up slightly from the final November score of 96.8.
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