News

Consumer confidence continues to sink in NY

By Tom Wanamaker

ALBANY — Consumer confidence — in both the state's current economic condition and its future — continues to sink lower across the state as New Yorkers battle high food and fuel prices.

In a survey released Monday, the Siena Research Institute revealed marked declines in both New Yorkers' faith in the economy and their willingness to spend money on durable goods during the second quarter of 2008.

“Just when we thought we had stopped the bleeding, we are hemorrhaging. These are the biggest drops across the board that we have ever seen,” said Douglas Lonnstrom, Siena College professor of finance and statistics and SRI founding director. “Every morning this quarter the consumer woke up to the news that gas prices were reaching new highs. The normal errand run to buy gas and groceries now drives most consumers down a dark, one-way street.”

New York City had the state's highest overall confidence index level, at 56.6. It also registered the highest year-over-year drop, 30.5, from the second quarter of 2007. Other overall confidence index levels by region, with their year-over-year declines in parentheses, are:

n Rochester: 54.4 (-21.3)

n Albany: 54.0 (-28.1)

n Syracuse: 53.1 (-23.1)

n Mid-Hudson: 52.9 (-27.4)

n Binghamton: 52.3 (-23.7)

n Buffalo: 51.6 (-25.0)

n Utica: 50.4 (-26.5)

Furthermore, consumers across the state show considerable reluctance to spend money on expensive items like homes, vehicles, computers, furniture and major home repairs. For example, only 1.9 percent of those surveyed in Buffalo had plans to buy a home, compared to 2.4 percent in Binghamton, 2.7 percent in Utica, 2.9 percent in Rochester, 3.1 percent in Albany, 3.9 percent in Syracuse, 4.5 percent in New York City, and 5.6 percent in the Mid-Hudson Valley.

The survey looks to measure both current and future consumer confidence which, when combined, provides a snapshot of consumers' overall confidence. The survey's intent is to evaluate the willingness of people to spend money, rather than their ability to do so. The index itself represents a tool for comparing consumer confidence at different points in time. Its base year, for which it is set at 100, is 1966.

This survey was conducted by random telephone calls to New York residents over the age of 18. The New York City index is based on an average of previous monthly consumer confidence surveys, while each of the other metro area indices is based on more than 400 respondents. More survey data is available online at www.siena.edu/SRI/2Q08CCI.

“As we study the areas of New York, we now find little difference in the willingness to spend across the entire state,” Lonnstrom said. “Down and low, we march together.”

Reader Comments

Submit a Comment