Third Quarter Report on New Jersey Consumer Views
Attentive Public Is Anxious
According to the end-of-quarter consumer survey by Fairleigh Dickinson University’s Silberman College of Business, 58% of New Jerseyans report their financial condition is worse than it was a year ago, up from 54% in June and a sharp increase from the beginning of the year when two in five (41%) respondents had a similar response.
“The hurt is generalized across all age groups,” said James Almeida, associate dean of the Silberman College of Business and a professor of entrepreneurial studies. “The uncertainty that has hit the financial markets over the past few weeks has also hit consumers.”
Half of respondents (51%) report that the crisis in the financial markets has affected their personal finances, with boomers (age 45-59) being the hardest hit (62%). On the other hand, 46% of New Jerseyans say they have not yet been directly affected and only one in four young adults (age 18-29) report they are affected. “Those less invested in the markets are less likely to feel the same pain right away,” said Almeida.
In addition, a majority (51%) think that housing prices will continue their slide downwards in the next year. “Unfortunately for retailers, this pessimism about housing prices is likely to restrain consumer spending,” said Almeida.
Pessimism is joined by anxiety as 30% say they are somewhat or very worried they might lose their job in the next 12 months, an increase from 24% in the July report.
A plurality, but not a majority, of New Jerseyans (44%) support the recent intervention by the federal government to manage the financial crisis. A third (35%) oppose it and another 21% have mixed feelings or are unsure. “Many people are convinced that while it may be a tough pill to swallow, the cost of inaction is likely to be much greater than the drawbacks of any government intervention,” said Almeida. Four in five respondents (79%) say they understand the causes of the crisis somewhat or very well, and even more (85%) say they are following somewhat or very closely the government’s plans to deal with the crisis.
A majority of respondents (53%) say they have little difficulty paying the balance on their credit cards while 30% say that keeping up with payments is somewhat or very difficult, little changed from the end of the first quarter but up five points from January. “This is something to keep our eye on,” said Almeida. “It’s a potential problem lurking in the background. The inability of customers to meet their credit card obligations would be the other shoe to drop in this crisis.”
However, those who believe things will be worse a year from now declined to 29% from 36% in July. More than a third (37%) say things will be better a year from now while 16% think things won’t change and 18% won’t venture a prediction. A majority under the age of 30 (58%) think things will be better for them in a year while just a quarter (27%) of those over 60 think things will be better.
The telephone survey of 1002 randomly selected adult residents throughout New Jersey who participate in household financial decisions was sponsored by Fairleigh Dickinson University’s Silberman College of Business and conducted by Fairleigh Dickinson University’s PublicMind from Sept. 29 2008 through Oct. 6, 2008. It has a margin of error of +/-3% percentage points.
Contacts: James Almeida 732-754-5461
Peter Woolley 973-670-3239
James Hutton 201-692-7241
For more information, please call (973) 443-8661.