A steep increase in the number of people fearing for their jobs is driving consumer confidence downward in Great Britain according to the latest Consumer Confidence Survey released by Nielsen and the British Retail Consortium (BRC).
Three-quarters of people questioned in the quarterly survey - which asks people their thoughts and feelings on job prospects, personal finances, major concerns and spending intentions - said that job prospects in the country will be 'not so good' (48%) or 'bad' (26%) over the coming year. That compares with 20 percent who felt they would be ‘bad’ in the Q2 survey.
Also contributing to the drop in the confidence index is a worsening of sentiment over personal finances. There has been a six percentage point increase in the number of people who believe that prospects for their own personal finances are ‘not so good,’ with 48 percent of people believing this now compared with 42 percent in Q2 and a further 13 percent now believing that their own personal finances are 'bad.'
When looking at major concerns, 'the economy' remains the nation’s biggest concern though this has eased somewhat. In Q2, 39 percent of people cited ‘the economy’ as either their first or second biggest concern. This has now fallen to 26 percent as people’s worries turn from the economy in general to their own ability to cope with the economic climate. Since the Q2 survey, there has been a significant rise in the number of people who are concerned about increasing utility bills (from 15% to 23%), food prices (from 12% to 20%) and debt (from 19% to 20%). The burden of personal debt continues to weigh heavy with one in five citing this as a major concern.
"This survey has told us that consumers are clearly concerned about inflation on petrol, utility bills and food shopping bills, underpinned by a sustained and increasing worry over jobs," noted Chris Morley, Group Managing Director, Nielsen U.K. & Ireland. "The levels and depth of promotions in the grocery sector remains at an all time high and taking advantage of these offers is just one way that shoppers are making savings. We expect similar tactics to be employed on the high street to help drive seasonal spending and we watch with interest to see if this will release some pressure on consumer confidence leading up to Christmas."
British Retail Consortium Director General Stephen Robertson added: “Consumer confidence is now down to its lowest for a year and these results suggest prospects for the early part of next year are fragile. People’s fears about their job prospects for 2011 are the main cause. Despite tentative indicators of recovery, four out of five people still think we’re in recession and more than half believe that won’t have changed by this time next year. With spare cash short and cutting back rising up the household agenda, a strong revival in consumer confidence is likely to be some way off.”
Other findings from the survey include: