Tennessee consumers are a bit sour on the current economy, but are slightly more upbeat about the future and their willingness to open their wallets, according to the first of an expanded economic survey by Middle Tennessee State University.
Released Wednesday, Oct. 7, the inaugural Tennessee Consumer Outlook Index came in at 15, a score that will serve as a baseline for future indices.
The Office of Consumer Research in the MTSU Jones College of Business conducts the survey, which measures areas such as how consumers feel about the local, state and national economies as well as their personal financial situations and the job market. A PDF copy of the full report is available here.
“Tennessee consumers tend to view the state’s economy more positively than they do the overall national economy,” Dr. Tim Graeff, director of the Office of Consumer Research, said of the first statewide survey.
“West Tennessee was the only region for which there were not more consumers rating the state’s economy more positively than the national economy.”
Survey results show that about one-third (36 percent) of state consumers expect to “spend more” than last year, while another third (35 percent) expect to spend “about the same.” The remainder (27 percent) expect to “spend less.”
“These results suggest that we might not see many significant changes in overall consumer spending in the near future,” Graeff said.
The new index, which will be measured four times a year, greatly expands upon MTSU’s previous consumer survey that captured a snapshot in three Middle Tennessee counties. The statewide index was measured from online surveys of 626 randomly selected adult Tennesseans and has a margin of error of 3.9 percent.
With consumer spending making up two-thirds of the American economy, MTSU decided to broaden its periodic survey to include the entire state of Tennessee.
The expanded index is based on responses to a set of 11 core questions, with the overall index score computed by adding the percentage of favorable responses to each question and subtracting the percentage of negative responses.
“This statewide snapshot should provide valuable information to business owners, decision makers and stakeholders about how consumers feel about the economy,” said Dr. David Urban, dean of MTSU’s Jones College.
The following are other highlights from the inaugural statewide survey.
- Perceptions about the economy vary widely from one region to the next. Consumers in Middle Tennessee have much more positive views of the economy, while those in West Tennessee hold relatively more negative views. East Tennessee consumers sit somewhere in the middle.
- The job market is still a concern. Three times as many Tennessee consumers believe that jobs are “hard to find” (33 percent) compared to “easy to find” (9 percent). This pattern is consistent for all three regions of the state, with consumers in West Tennessee holding the most negative views, where 43 percent said jobs are “hard to find” versus only 6 percent who said that jobs are “easy to find.”
- Consumers are more optimistic about future personal finances than their current situation. However, this optimism seems predicated on consumers’ ability to maintain their current employment. When asked if they would be able to survive financially if they lost their job (or primary source of income) tomorrow, relatively few consumers feel confident. In fact, the majority (58 percent) responded with either “probably no” or “definitely no.”
- Lack of saving can contribute to low levels of confidence. When asked about their level of saving compared to a year ago, a greater percentage of consumers reported saving “less” than reported saving “more.”
MTSU also launched the Tennessee Business Barometer over the summer in partnership with the Tennessee Chamber of Commerce & Industry. This new quarterly index captures the mood and outlook of business leaders statewide through online surveys. The next index will be released later this month.
For more information, contact Tim Graeff, professor of marketing and director of the Office of Consumer Research, at 615-898-5124 or Tim.Graeff@mtsu.edu, or visit www.mtsu.edu/consumer.
— Jimmy Hart (firstname.lastname@example.org)