More Consumers Expect Better Personal Finances, Buying Conditions in Near Future
FAYETTEVILLE, Ark. — A majority of consumers in Arkansas, Missouri and Oklahoma surveyed in October expects their personal financial situation to improve or remain the same within the next year, and half of them believe the next six months will be a good time to purchase major household items.
These observations are found in the second phase of the Fall 2014 Arvest Consumer Sentiment Survey released today. This phase includes a study of consumers’ outlooks on personal finances, buying conditions over the next six months, and business conditions over the next year and the next five years.
Consumers in the three-state area were surveyed in October. Results indicate 80 percent of them expect their personal financial situation to remain the same or improve over the next 12 months, up 2 percent from June’s inaugural survey.
Specifically, consumers showed slightly more confidence in their personal financial situation, evidenced by the fact 29 percent expect improvement in that regard over the next 12 months. That’s up 2 percent from June. An identical 51 percent expect their situation to remain the same.
“We’re pleased to see that people in our footprint feel better about their personal financial situations and they believe the next six months will be a good time to make major household purchases. That seems to bode well for our local economies.”
Half of those surveyed, meanwhile, expect the next six months to be a good time to buy household items such as furniture, televisions and refrigerators. That’s up from 47 percent in June.
“This is one of the reasons we sponsor this survey,” Arvest Marketing Director Jason Kincy said. “To gauge how consumers’ opinions change over time and how that affects the economy.”
When looking at expectations of business conditions, respondents were less optimistic. Only 25 percent expect business conditions to be favorable in the next year, compared with 29 percent in June. Additionally, 51 percent expect business conditions to be bad during the next 12 months, up from 49 percent in June.
Expectations were similar when expanding the time period to five years, with 36 percent of those surveyed anticipating continuous good times. That’s down 1 percent from June.
This round of survey results also includes a Current Conditions Index and a Consumer Expectations Index, which follows the model of the national Thomson/Reuters Michigan Surveys of Consumers.
These indexes are meaningful in comparison to national indexes or to previous values of Arvest Consumer Sentiment indexes. Higher numbers indicate some combination of consumer satisfaction with their current and expected personal finances, current and expected economic performance, and the purchasing environment. Larger increases indicate more confidence across the three areas.
The Current Conditions Index is tabulated from the answers to two questions on the survey: “How is your current financial situation compared with a year ago?” and “What do you think of buying conditions over the next six months?” The Current Conditions Index for the region is 82.0 in October, compared to 78.7 in June.
The Consumer Expectations Index is tabulated from the answers to three survey questions: “How do you expect your financial situation to change in the next year?” “How do you think business conditions will be in a year?” and “How do you expect business conditions will be in five years?” The regional Consumer Expectations Index in October is 66.5, compared to June’s 66.7.
The Arvest Consumer Sentiment Survey is conducted by the Center for Business and Economic Research in the Sam M. Walton College of Business at the University of Arkansas in Fayetteville, with the University of Oklahoma’s Public Opinion Learning Laboratory conducting 1,200 phone surveys.
Arvest Bank’s sponsorship of this survey is due to its desire to provide beneficial data for its customers and communities. The data provides a reading of how consumers are feeling about the economy in the states where the bank operates. Additionally, with future results, consumers, as well as the business community, will be able to see how sentiment is trending.
The Bureau of Economic Research at Missouri State University provides state analysis of the Missouri data. The Steven C. Agee Economic Research & Policy Institute, Meinders School of Business at Oklahoma City University, evaluates the data for Oklahoma.
The survey will be conducted twice a year, with the next survey expected to be completed in May 2015. With each study, the index score will be released first, followed by a second release on consumer outlook including the Current Conditions Index and the Consumer Expectations Index and a third release on savings and spending expectations.
Information about the survey and research partners, copies of this release, summary documents and print-ready logos can be found at www.arvestconsumersurvey.com.
About Our Research Partners
The Center for Business and Economic Research, Sam M. Walton School of Business at the University of Arkansas at Fayetteville (CBER) provides excellence in applied economic and business research to federal, state and local government, as well as to businesses currently operating or those that desire to operate in the state of Arkansas. The center further works to improve the economic opportunities of all Arkansans by conducting policy research in the public interest.
The University of Oklahoma Public Opinion Learning Laboratory (POLL) serves two functions: to provide a learning environment for the teaching of survey design, public opinion research and data analysis for the purpose of developing student capabilities to conduct academic and professional research and analysis; and to conduct research on public opinion, in order to foster knowledge about public affairs and to assist in the conduct of research on public policy of import to state and local governments, media organizations, other public and private entities, and the general public.
The Meinders School of Business (MSB) at Oklahoma City University, which includes the Steven C. Agee Economic Research & Policy Institute, offers a full range of undergraduate, graduate and professional development programs. MSB prepares graduate and undergraduate students to be socially responsible leaders in a global economy through teaching excellence and faculty scholarship in business practice and the disciplines. Faculty and students engage with the business community, local government and regulatory agencies as part of the teaching-learning process.
The Bureau of Economic Research, housed within the Economics Department at Missouri State University, serves as a clearinghouse for data and publications on economic conditions within the region, state and nation. The staff has a wide variety of experience and is able to provide consulting services, produce detailed GIS maps, economic and industry forecasts and other relevant reports.