More Consumers See Improvement in Personal Finances
Arvest-Backed Survey Shows Mixed Views on Business Expectations
FAYETTEVILLE, Ark. (Nov. 24, 2015) – About a fourth of consumers surveyed in Arkansas, Missouri and Oklahoma said they are better off than at the same time a year ago, and about a third of them expect their personal financial situation to improve over the next 12 months.
That's according to results from the second phase of the Fall 2015 Arvest Consumer Sentiment Survey, which was 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, including Greater Kansas City, were surveyed in September, and 24 percent of them said their current financial situation is better than a year ago. That's an increase of 1 percent since March.
In terms of how they expect their personal financial situation to change over the next 12 months, 33 percent of respondents expect to see improvement. That's the same number as reported in March.
Additionally, 57 percent said their personal financial situation is the same as a year ago and 56 percent expect their situation to be the same a year from now.
More than half of those surveyed, or 55 percent, expect the next six months to be a good time to buy household items such as furniture, televisions and refrigerators. That's down from 59 percent in March.
"It is good to see the consumers we're here to serve maintain a positive outlook in terms of their financial situations," Arvest Marketing Director Jason Kincy said. "For those who plan to make major household purchases in the near future, we remain prepared to help them via consumer loans, strategic savings plans or whatever makes the most sense for their individual situation."
Kathy Deck, director of the Center for Business and Economic Research in the Sam M. Walton College of Business at the University of Arkansas and lead economist for the survey, said Arkansans have a mixed outlook.
"Over the next year in Arkansas, there are expectations of an improving national economy, while consumers were less optimistic about their own prospects than they were in March," she said.
Russell Evans, director of the Steven C. Agee Economic Research & Policy Institute at Oklahoma City University, said consumers in his state have shown a similar outlook.
"Oklahomans overwhelmingly (89 percent) expect their financial situation to be the same or better in a year," he said, "while remaining cautious about business conditions in the year ahead."
Missourians also expressed caution about future business conditions, but "have definitely been responding positively to the sustained decrease in gas prices and increase in job growth in Missouri," said David Mitchell, director of the Bureau of Economic Research at Missouri State University.
As a region, respondents were more optimistic in their expectations of business conditions when looking at a longer timeframe. While only 32 percent expect business conditions to be favorable in the next year, 43 percent expect good conditions in five years. Those numbers are down 2 percent and up 1 percent, respectively, since March.
This round of results also includes a Current Conditions Sub-Index and a Consumer Expectations Sub-Index, which follows the model of the national Thomson/Reuters Michigan Surveys of Consumers.
The Current Conditions Sub-Index for the region is 90.3 in September, compared to 92.2 in March. The 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 regional Consumer Expectations Sub-Index in September is 77.5, compared to March’s 77.4. The 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?"
These sub-indexes are meaningful in comparison to national indexes and 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 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 2016. 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.