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Consumer Confidence Another year, another new low in consumer confidence. This seems to be the story of Orange County in the 1990s. The 1993 survey finds the Orange County Consumer Confidence Index at 73. This is below last year's record low of 75, and behind the national average which currently stands at 75. A growing pessimism about personal finances and the long-term outlook for the nation's economy contributed to the decline in the overall index. Only one measure has improved from last year, and it's one that sends a glimmer of hope to retailers. The one shining light is that 52 percent think now is a good time to make major purchases, while only 34 percent say it is a bad time. Last year, only 48 percent thought it was a good time to spend money on big-ticket items such as furniture and appliances, and 40 percent said it was a bad time. However, overall the bad news outweighs the good news in the annual assessment of consumer confidence. Thirty percent of residents describe themselves as "better off" financially now than they were last year, while 36 percent say they are "worse off." In 1992, 35 percent reported being better off than a year before. This is the first time that the number saying they are worse off exceeds those saying they are better off. Looking to next year, 41 percent say they will be better off next year than they are now. In 1992, 44 percent expected to be better off in the coming year. Thus, optimism about future finances is continuing to drop. Fifty-eight percent expect bad economic times nationwide in the next 12 months, while only 29 percent think conditions will be good. These numbers are unchanged from the record lows of last year that led to the defection from Republican President Bush. By a 2-1 margin (60% to 31%), more residents expect bad economic times than good times nationally during the next five years. Long-term optimism has declined since last year, and is the worst recorded to date. Taking all these responses together, the five-question Consumer Confidence Index in Orange County is now at 73. This is a 12-point drop from 1990 and a 36-point fall since 1986, the first year the University of Michigan questions were used in Orange County. Nationwide, the Consumer Confidence Index now stands at 75, according to the University of Michigan. The Consumer Confidence Index is calculated from a formula provided by the University of Michigan, which computes scores for each question (better - worse + 100) and then adjusts by the 1966 base period. The national index score was 100 in 1966. This year, for the first time, we analyze the Orange County Consumer Confidence Index by demographic group. Residents 18 to 34 are the most optimistic, with index scores of 84. Meanwhile, residents 35 and older are considerably less hopeful, with index scores below 70. Upper-income households and South County residents are not much more positive than the countywide average. Median annual household income stands at $47,000, showing
a 4 percent increase from the 1992 survey. The Consumer Price Index
indicates that the inflation rate has been about 3 percent in the past
year, thus, Orange County consumers made a small gain in income this
year. Still, they are lagging behind the average income levels in 1990.
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