The Conference Board said on April 27 that its Consumer Confidence index increased to 57.9, up from a revised 52.3 in March. The April reading is the highest since September 2008's 61.4. That was when the financial crisis intensified with the collapse of Lehman Brothers, sending confidence into freefall the following month.
The upbeat reading, combined with bullish earnings reports this week from companies ranging from Whirlpool Corp. to UPS Inc., offers more hope the economic rebound is gathering steam.
The index -- which measures how shoppers feel about business conditions, the job market and the next six months -- had been recovering fitfully since hitting an all-time low of 25.3 in February 2009.
April's reading is still far from what's considered healthy. A reading above 90 indicates the economy is on solid footing; above 100 signals strong growth. Still, the monthly survey of consumers showed that consumers' current and short-term concerns about jobs and the overall economy are easing.
One component of the overall index, which assesses how consumers feel now about the economy, rose to 28.6 in April from 25.2 in March. The other component, which measures shoppers' outlook over the next six months, climbed to 77.4 from 70.4.
"Looking ahead, continued job growth will be key in sustaining positive momentum," said Lynn Franco, director for The Conference Board Consumer Research Center.
Economists believe confidence will remain relatively weak for at least another year because companies haven't begun to dramatically ramp up hiring. "I think it is good to see the (confidence) numbers moving up again, but I don't call it a major change in confidence," said Gary Thayer, chief economist at Wells Fargo Advisors. "But it does reflect a more optimistic view in the job market."
The Conference Board survey -- based on a random survey of consumers sent to 5,000 households from April 1-20 -- showed worries about jobs were easing. Those saying that jobs are "plentiful" increased to 4.8% from 4%, while those saying jobs are "hard to get" decreased to 45% from 46.3%.
Consumers were also more upbeat about the job outlook. The percentage of consumers anticipating more jobs in the months ahead increased to 18% from 14.1%t, while those anticipating fewer jobs fell.
Thayer noted that he still expects an overall modest economic recovery citing both weak and strong pockets. Manufacturing may be showing signs of strengthening, but small businesses, which are typically a big source of hiring, are still struggling as they continue to have a hard time getting credit, he said.
Copyright 2010 The Associated Press.