Global consumer confidence declines in Q2
By Paula Aven Gladych
Global consumer confidence declined in the second quarter of 2012, according to new data from Nielsen. The company surveyed more than 28,000 online consumers in 56 countries throughout Asia Pacific, Europe, Latin America, the Middle East and North America in May for its Nielsen Global Survey of Consumer Confidence and Spending Intentions.
It found that overall consumer confidence went down three index points to 91 in the second quarter, up two index points from the same period in 2011. Overall confidence rose in 41 percent of global markets measured by Nielsen, compared to a 68 percent increase in the previous quarter. Consumer confidence dropped in 26 of 56 markets, increased in 23 and remained flat in seven.
“Consumers are clearly proceeding with caution in relation to their spending intentions,” said Dr. Venkatesh Bala, chief economist at The Cambridge Group, a part of Nielsen. “Consumer confidence lost momentum in the second quarter as global events, including a worsening Euro zone crisis coupled with slowing growth rates in China and India, impacted financial markets and consumer sentiment in many parts of the world. As renewed volatility entered global markets, consumers reacted by reining in spending and consumption intentions.”
The economy and job security remain top concerns for global consumers, with 16 percent saying the economy is their top concern and 14 percent saying they are concerned about job security. Ten percent of respondents said they were concerned about balancing work with life responsibilities.
Of those polled, 47 percent said their job prospects were good or excellent, which was down 1 percentage point from the previous quarter and up three percentage points from the previous year.
More than half of global online consumers considered their personal finances over the next 12 months to be good or excellent, down two percentage points from the first quarter and up four percentage points from the second quarter of 2011.
Discretionary spending and saving decreased globally across all sectors reviewed. Twenty-three percent of those surveyed said they would spend spare cash on new technology products, down five points from the first quarter, and 28 percent said they would spend spare cash on out-of-home entertainment, down four points from the first quarter.
Holidays and vacations declined three points from the first quarter to 30 percent and saving intentions decreased from 50 percent in the first quarter to 47 percent of global respondents who said they would put spare cash into savings in the second quarter.
More than two-thirds of respondents said they changed their spending habits to save on expenses. Of those, 51 percent said they spent less on new clothes, 48 percent cut down on out-of-home entertainment and 47 percent said they try to save on gas and electricity.
In North America, consumer confidence declined four points to 88 and two points to 96 in Latin America. The Middle East, Africa and Europe all experienced a one point increase in consumer confidence.
France, Belgium, Finland, Switzerland, Austria, Egypt, Greece, Poland, Malaysia and Sweden saw the biggest gains in confidence in the second quarter.
“While the economic situation in France remains challenging as unemployment rates in April and May were the highest in 10 years, price increases for fast-moving consumer goods is slowing down and sales remain somewhat protected from the crisis,” said Laurent Zeller, managing director of Nielsen France. “The rise in optimism in the second quarter was also fueled by a post-election euphoria as new President François Hollande buoyed hope for the future. The current mood was measured prior to the Parliament elections won by the socialist party, but the outlook will likely turn gloomy as the government will soon announce measures, such as higher taxes, to cope with public deficit and debts and to fund some social benefits."
Indonesia had the highest consumer confidence index at 120, topping India’s score of 119. The biggest quarterly consumer confidence declines came in Taiwan (-12), Argentina, Australia, China, Netherlands and the United States (-5), Brazil, India, Italy, Norway and Saudi Arabia (-4).
Originally published on BenefitsPro.com