Business execs comment on consumer confidence

Editor’s note: Roby Brock, with our content partner Talk Business, wrote this report. He can be reached at [email protected]

Looking at survey data from the latest Arkansas Consumer Confidence Report, citizens believe state and national business conditions and job prospects are fairly bleak, but a variety of economic data bucks that notion.

In the latest report, only 3% of the 554 Arkansans surveyed thought national business conditions were good, while 80% said they were bad and 17% said they were normal.

At the state level, just 9% saw current business conditions as good versus 51% who said they were bad, and 40% who viewed them as normal. Attitudes toward job opportunities were equally as dire with just 9% describing jobs as plentiful and only 13% expecting better prospects six months from now.

“These answers don’t surprise me at all based on my conversations with economic developers throughout the state," said Kirkley Thomas, manager of economic development for the Electric Cooperatives of Arkansas, a sponsor of the Arkansas Consumer Confidence Report. "There is a very real level of frustration and anxiousness regarding the lack of a jobs rebound."

Thomas said the start-and-stop nature of the recovery reminds him of a scene from the movie, "Perfect Storm."

"When Captain Billy Tyne, played by George Clooney, sees a sliver of sunlight and the clouds breaking, he has a brief moment of hope. But then the skies darken again and he’s fighting with all his might to save the crew and ship and he says, almost in despair and disbelief, ‘She’s not going to let us out!’ This has to be what many business and industry leaders feel, as well as economic developers," said Thomas.

He noted several positive developments in Arkansas in recent months, such as Atlas Tube’s reopening in Blytheville, Firestone’s expansion in Prescott and Nestle Foods small expansion in Jonesboro. Those positives can be quickly dashed by layoffs like the ones announced in Harrison late last week.

Thomas said there is activity at the local level for potential economic development opportunities, "just not in numbers maybe everyone would like," he says.

He’s also worried that the recent April and May storms will hamper economic recovery efforts in rural Arkansas.

"With the recent record floods, putting millions of acres of farm land out of commission for this year’s planting season, there’s no relief in sight here," said Thomas.

French Hill, CEO of Delta Trust and Bank, also a sponsor of the consumer confidence report, said there is data that suggests greater improvement in the economy than what is reflected in current attitudes.

"I do not believe that we will have a double-dip recession. I do not believe the economy is going to fall off a cliff," Hill said. "But we don’t have that attitudinal adjustment that is even mirroring some of the good things happening in the economy."

Hill pointed to slow, but steady overall improvement in employment numbers, positive manufacturing and export data, solid corporate profitability, as well as rising gross domestic product. But complications in the housing market and its impact on consumers’ incomes have torpedoed hope for a quick rebound.

"This recession was nationwide, was driven by a sinking in personal residence prices, and that is what’s really hurt us," Hill said. "It could be 2 or 3 more years before we see any strong recovery in housing construction and housing sales and all the things that go with it."

POLL BACKGROUND
The Arkansas Consumer Confidence Report is sponsored by Delta Trust & Bank and the Electric Cooperatives of Arkansas. The survey was conducted by Talk Business Research. The poll, which has a margin of error of +/- 4.1%, was completed using IVR survey technology on Thursday, June 9, 2011 among 554 registered Arkansas voters statewide. All media outlets are welcome to reprint, reproduce, or rebroadcast information from this poll with proper attribution to Talk Business.