Consumers in Arkansas say their personal finances have improved this year and so have their expectations for the state’s business climate next year, according to the Arvest Consumer Sentiment Survey this fall.
The survey conducted in August showed 42% of respondents expect their finances to improve over the next year. That compared to 38% who were asked the same question in March. Arkansans were more optimistic that those consumers surveyed in Oklahoma (40%) and Missouri (38%).
“For the first time since the beginning of the Arvest Consumer Sentiment Survey, Arkansas consumers expressed more optimism about the future than their national counterparts,” said Kathy Deck, director of the Center for Business and Economic Research (CBER) at the University of Arkansas and lead economist for the survey. “High sentiment readings were recorded for all three components of the expectations index, indicating high hopes about future personal financial conditions, shorter-term business conditions and longer-term business conditions.”
When it came to determining buying conditions, 57% of Arkansans believe the next six months will be a good time to buy items like furniture, televisions and refrigerators. That’s up from the 55% who thought so in March. By comparison, 55% of the entire region believes the next six months will be a good time to buy, up 2% from March.
Arkansans were more optimistic in August than March in terms of expected business conditions over the next year, with 31% expecting good times compared with 28% reported in March. They were also more optimistic for the longer range, with 42% expecting good times over the next five years. That compares to 40% in March.
Expectations for the region as a whole also improved since the March survey. Regional respondents from the three-state area who expect good times for businesses over the next year jumped from 24% to 32%, and 43% expect good times over the next five years. That compares to 41% in March.
This round of survey results also includes a Current Conditions Sub-Index and a Consumer Expectations Sub-Index, which follow the model of the national Thomson/Reuters Michigan Surveys of Consumers. These sub-indexes are meaningful in comparison to national indexes or 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, Arvest said.
The Current Conditions Sub-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 Current Conditions Sub-Index for Arkansas in August was 92.4, up from March’s 91.5, while the regional index was 91.0.
The Consumer Expectations Sub-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?” Arkansas’ Consumer Expectations Sub-Index in August was 83.0, up from March’s 80.7, while the regional index was 82.1.