A nationwide survey issued by Citi and conducted by Hart
Research Associates revealed that Americans are more optimistic
about economic conditions than in any quarter since the survey
began in September 2009. The Citi Economic Pulse, a quarterly
measure of Americans' attitudes toward the economy, remains in
negative territory but rose to a new high of -4 in Q3 2012 after
hitting its lowest point of -17 in Q3 2011. Unlike 2010 and 2011,
when the Pulse advanced in the first quarter only to turn downward
again later in the year, attitudes have continued to improve in
2012.
"Consumer confidence has risen significantly in the last 12
months, and Americans are now more optimistic than at any point
since we introduced the Citi Economic Pulse three years ago," said
Michelle Peluso, Chief Global Consumer Marketing and Internet
Officer, Citi. "Whether or not that momentum will persist or fade
is very much an open question, but this latest reading is an
encouraging sign."
Increase in Economic Outlook Reflects Decrease in
Negativity
In general, the third quarter Pulse finds less of an increase in
positive views of the economy, but rather a notable decrease in
negative views. For example, 75 percent of consumers rate
employment opportunities in their area as only fair or poor, which
is 10 points lower than a year ago (85 percent). In the same vein,
19 percent say local employment opportunities are excellent or
good, which is six points higher than a year ago.
Overall, 28 percent of consumers rate the current condition of
their local economy as excellent or good, which is a five-point
increase since Q3 2011, while 70 percent rate their local economy
as only fair or poor, a two-point decline since March 2012. In the
coming year, 51 percent expect conditions to get a least somewhat
better. This is a 10-point improvement since August 2011 when only
41 percent were optimistic. Interestingly, the greatest recent
shift in consumer sentiment is being seen among the youngest and
lowest-income groups, who typically are more sensitive to local
economic conditions.
Consumers Gain Control over Finances as Sacrifices
Wane
Over the past four years following the economic downturn,
Americans have dramatically altered the way they save and spend,
but within the past few months there are signs of another change as
consumers say they are getting better control of their finances and
fewer report making sacrifices because of the economy.
When given a list of possible changes to their saving and
spending habits, more than three quarters (76 percent) of Americans
report that they are getting better control of their finances or
putting themselves on a budget. While 60 percent of Americans are
currently cutting down on credit card purchases, that marks an
eight-point decrease from November 2011. There is a similar drop in
the number of consumers who say they have been eating out less
often, from 67 percent who said so in August 2011 to 58 percent in
the current survey. Some Americans are still forced to consider
drastic financial decisions due to the slow economy: 29 percent are
working longer hours to make ends meet, and 24 percent are doing
jobs they would not choose in a better economy but each of these
decreased five points since November 2011.
Mobile and Online Banking Numbers Climb - More than Just
a Youth Movement
Internet-enabled mobile devices are more commonplace than ever
for Americans, with just under half (49 percent) saying they own a
smartphone or tablet. The majority of those owners (64 percent) use
their mobile device to manage their finances.
Younger Americans, ages 18 to 34, are more likely to use online
or mobile banking, with 81 percent of computer owners saying they
manage their finances on a computer and a majority (72 percent) of
mobile device owners saying they bank on their mobile devices.
However, the findings show that older Americans are embracing
mobile and online banking as well. Sixty-seven percent of 35- to
49-year-olds, 53 percent of 50- to 64-year-olds and almost half (48
percent) of 65-year-olds and over who own a mobile device are
already currently using their mobile devices to manage their
finances.
"Nearly a third of Americans are already using a smartphone or
tablet to manage their money, and today older generations are
increasingly accounting for the growth in mobile adoption," Citi
Managing Director and Head of Consumer Internet and Mobile Banking
North America Tracey Weber. "Even those who have mobile devices but
don't engage in mobile banking say they are interested in trying
some of the new mobile offerings like mobile-to-mobile payments and
mobile check deposit, so we expect those numbers to continue to
grow."
While only one in 10 (11 percent) of mobile device owners
currently use "tap and go" payment technology, nearly half (48
percent) are interested in adopting the application in lieu of cash
or credit cards. In addition, 41 percent are interested in
mobile-to-mobile payments and 45 percent are interested in mobile
check deposit.
Survey Methodology
Hart Research Associates conducted the telephone survey of 2,001
adults from July 31 to August 7, 2012. The overall statistical
margin of sampling error is ±2.19 percentage points for the main
sample and is higher among subgroups.
Pulse Methodology
The
Citi Economic Pulse is calculated by subtracting negative
responses to each item from the positive responses for 8 Pulse
items, divided by 8. The 8 Pulse items include: current condition
of the economy in area; business conditions in area over the next
twelve months; current employment opportunities in area; buying
climate for big ticket items; personal financial situation compared
to a year ago; outlook on personal financial situation for the next
twelve months; comfort with current level of savings; and comfort
with current level of debt. The Pulse scale can range from +100 (if
every respondent gave positive response to each of the 8 questions)
to -100 (if all respondents expressed consistently negative
views).