NI CONSUMER CONFIDENCE INDEX SHOWS HEALTHY REBOUND

Transcription

1 News Release Embargoed until 00:01 23 July 2013 NI CONSUMER CONFIDENCE INDEX SHOWS HEALTHY REBOUND Local consumer confidence levels have bounced back in the second quarter of the year to reach their highest level in three years, according to the latest report from Danske Bank published today. Danske Bank s survey of Consumer Confidence in the local economy looks at the financial position of local households and their expectations for the year ahead. The latest report shows that the overall confidence index increased by 13 points to 117 in quarter two, a 9 point increase on the same period last year. Commenting on the latest movement in the index, Danske Bank s Chief Economist Angela McGowan said: This latest rise in consumer confidence reflects the general improvement in economic conditions that we have seen over the last few months and augers very well for the economic climate in the months ahead. Consumer confidence levels are a strong driver of economic activity and growth, so a recovery in this index is an important indicator. Overall the index is moving in the right direction, with a significant move away from negative opinions towards more neutral or even slightly positive responses. It is interesting that the index can improve like this even when real incomes are actually falling; but such a strong rebound does suggest that people are definitely less gloomy and slightly more optimistic about their economic future. Perhaps the recent job creation announcements in Northern Ireland, the successful G8 summit and the calmer economic climate in Europe have all worked to raise levels of optimism. The latest survey saw an improvement in all aspects of the confidence index but expectations for future finances and expectations for spending showed the strongest rebound. Overall,

2 males were found to be more optimistic than females and the South region (Lisburn, county Down, Newtownards, Newry & Mourne, Banbridge, Craigavon and Armagh) also displayed the highest levels of consumer confidence. The year old cohort had consistently higher levels of confidence compared to other age groups. Expectations for Spending The latest survey showed a substantial rebound when it came to expectations for spending, with this aspect of the survey moving to its highest level since records began. A full 18 per cent of those surveyed said that they plan to spend more on big ticket items during the next 12 months. This represents a rise from 14 per cent in the previous quarter and only 10 per cent a year ago. People aged were the most buoyant age group when it came to spending with an impressive 28 per cent planning to spend more. However pensioners showed most caution with only 11 per cent optimistic about future spending plans. The survey also revealed a significant fall (from 41 to 33) per cent in the number of people who plan to rein in their spending. People over 50, pensioners and the unemployed were the dominant age groups when it came to plans to spend less. Ms McGowan added: Although the latest survey may provide a little comfort to high-street retailers, the reality remains that spending patterns have shifted and online sales continue to grow while highstreet footfall declines. Even when local confidence and spending intentions start to creep up, high-streets across Northern Ireland will still have to adapt to the dramatic changes in consumer behaviour that are currently going on. Financial position The survey saw an increase in the number of people who felt their financial position had improved over the year from 10 to 13 per cent. This improvement was combined with a decline in the number of people who felt that they were worse off relative to last year (a fall

3 from 45 per cent to 37 per cent). The survey also found a marked difference in how high/ middle income households perceived their financial situation compared to low income or unemployed households. A full 19 per cent of high income households felt they are better off now relative to last year compared to only 4 per cent of low income and unemployed households. Expectations for Finances in next 12 months There was a small rise in the number of people who believed their financial situation would improve in the next 12 months (from 12 to 14 per cent ). There was also a significant fall (from 34 to 26 per cent) in the proportion of people who thought that their financial situation will deteriorate in the next 12 months. Job Security Confidence around job security saw a very marginal improvement in the last quarter. While there was a small rise (from 5 per cent to 8 per cent) in the proportion of people believing that their job security would improve; there was also a small decline in the number of respondents (from 16 per cent to 14 per cent) who believe that their job security could deteriorate. In summary Ms McGowan noted: An improving economic environment is essential for raising living standards for everyone in Northern Ireland. As the economy is only now turning a corner; it would be most unfortunate if Northern Ireland s political tensions were to allowed to stifle local investment and future job opportunities.

4 125 NI Consumer Confidence Index: Sept 2008 to June Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 ENDS For further information, or to arrange an interview with Angela McGowan, please contact Jonathan Ireland at MCE Public Relations on or Notes to Editors: The study was carried out by Millward Brown in June 2013 with 1,000 people. It is statistically representative of the Northern Ireland population with a variance of -/+ 3 per cent. The Consumer Confidence Index for Northern Ireland examines four key areas which include information on personal finances compared to 12 months ago, as well as consumers expectations for spending, job security and their general financial position over the next 12 months. In addition, the survey gathers information on household savings The Consumer Confidence Index for Northern Ireland published by Danske Bank is the first of its kind to be made available locally.

5