Reports show consumer concern in Fort Smith area

Two recent consumer confidence reports clearly indicate that consumers in the Fort Smith region aren’t optimistic about their financial situation or the future of the regional economy.

On Wednesday (April 6), the University of Arkansas at Fort Smith released its Index of Consumer Sentiment that showed “negative sentiment was consistent across all indices.”

For the first quarter ended March 31, the Fort Smith MSA consumer sentiment index was 58.5, down 9.3% from the fourth quarter result of 64.5.

The UAFS index supports results of The Consumer Compass Report released by The City Wire on March 1. The quarterly survey of 601 area residents showed a decline in the number of people who believe their financial situation will be better a year from now.

As of Nov. 29, 16% of respondents to The Consumer Compass Survey said their personal financial will be better in one year, with that number falling to 12% in the survey conducted Feb. 22-23.

The survey, conducted for The City Wire by Talk Business Research and Hendrix College, is a supplement to The Compass Report.

“As we have seen for three quarters now, regional residents in western Arkansas have a guardedly pessimistic view of economic conditions at the local, state and national level,” said Roby Brock, executive editor of Talk Business and owner/analyst for Talk Business Research. “Local optimistic attitudes remain in the low teens for the state and local economy, and they dip into the single digits for optimism about national economic health. These are trends we’ve witnessed since last summer.”

The Consumer Compass Report also found that the number of residents who think their personal finances will improve in the next year is an anemic 12%, about 4 points lower than it was three months ago.

Results of The City Wire and the UAFS reports are consistent with a University of Michigan index that reported a 67.5 for March, 9.4% lower than December. Index scores below 100 reflect less optimism about the economy than scores above 100.

“Rising gas prices, continuing negative news in the housing market and talk of inflation and deficits in the national news make for an unhappy consumer,” said Dr. Kermit Kuehn in the UAFS statement.

The UAFS report also summarized results for two sub-indices, both lower as well. The Index for Current Conditions (ICC), a measure of consumer attitudes about their current economic situations, decreased 7.9% to 59.8 from 64.5. The Index for Consumer Expectations (ICE), which measures consumer feelings about future economic conditions, was down 10.2% over last quarter, recording a 57.6.