Utahns still jittery about economy, poll says

Published: Tuesday, June 28 2011 3:28 p.m. MDT

SALT LAKE CITY — A large majority of Utahns say they are either the same or worse off economically than they were a year ago and they don't have much confidence that the state's economy is recovering, according to a new poll.

A Dan Jones and Associates survey this month for the Deseret News and KSL-TV indicates that 30 percent of Utahns have little or no confidence that the state economy is recovering from the recession, while 27 percent are confident or very confident in the recovery.

A plurality, 42 percent, have neutral opinions on the economy.

The poll surveyed 406 Utahns on June 13-15 and had  a 5 percent margin of error.

In a separate confidence gauge released Tuesday, the Zions Bank Utah Consumer Attitude Index for June fell to 66.3 — down 4.4 points compared with the previous month. The national Consumer Confidence Index showed a decrease of 3.2 points to 58.5.

An index of 70 or below is indicative of slow economic growth.

Consumer optimism in Utah fell for the third straight month as higher prices took a bigger chunk out of household budgets, explained Randy Shumway, chief executive officer for the Cicero Group, which owns Dan Jones & Associates and announced the latest Zions Bank index results.

The state Present Situation Index, a snapshot of current business conditions and employment, decreased 7 points to 39.9 — the largest single-month drop year-to-date. The national Present Situation Index decreased 1.7 points to 37.6.

Shumway said there are reasons to be optimistic about the Utah economy, including falling unemployment (down 0.1 last month), increased individual savings rates (from 1 percent in 2005 to 6 percent in 2011) and decreasing fuel prices (gasoline down 13 cents per gallon and crude oil down from $114 a barrel to $90 per barrel since Memorial Day).

But, many consumers are still unsure about their personal circumstances, he said, as the Great Recession has made consumers skittish about increasing their spending and employers reluctant about increasing hiring to an even greater degree.

Shumway likened the current economic situation to a person who had recently "had their nose broken."

"You get your nose broken, (and) anytime someone gets within two feet … you're protective of it," he explained. "You're anxious. You're uneasy."

Case in point, the Expectations Index for six months from now, which more closely projects the direction of consumer spending, fell to 83.9 in Utah — a 2.6-point decrease from May, Shumway said.

The national Expectations Index decreased 4.3 points to 72.4.

Poll results indicated that the extended period of uncertainty has taken a toll on consumer confidence in Utah.

Asked if they were better or worse off economically now than the previous year, 41 percent of respondents said they were somewhat or much worse off, compared with just 24 percent, who said they were somewhat or much better off.

In contrast, 34 percent responded that their economic circumstance was about the same as the previous year.

"Seventy-five percent say they are about the same or worse," said Jeff Thredgold, Zions Bank economic consultant. "Much of that reflects economic anxiety and (declines) in home prices."

The vast majority of people's home values are down in Utah and across the country, Thredgold said.

"So if people calculate their own balance sheet or net worth, in many cases they are going to be worse off," he said.

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