Outlook among Tennessee consumers has improved heading into the summer months, but the improvement was the result of two offsetting trends, according to the latest statewide survey by Middle Tennessee State University.
The Tennessee Consumer Outlook Index continued its rise into positive territory in June with a score of 20, up from 1 in March and well above the -58 score in December 2020, reports the Office of Consumer Research in the Jennings A. Jones College of Business at MTSU.
Perceptions of the current economic situation rose dramatically and reached positive territory for the first time in over a year. Yet expectations for the future of the economy and views regarding making large purchases declined. These declines were most noticeable among consumers in West Tennessee.
“This suggests that even though consumers believe the economy has improved as it recovers from the pandemic, concerns about potential rising taxes and inflation might dampen consumers’ desire and ability to increase spending,” noted Tim Graeff, marketing professor and director of the Office of Consumer Research.
Expanding vaccination rates across the state (36%) and country (46%) as of June 28 have given Tennessee consumers greater resolve when resuming shopping, travel and vacation plans, Graeff noted.
“This reflects a renewed sense of comfort as consumers begin to think about opening their wallets and spending money in ways they were not able to spend most of last year,” he said. “Consumers are much more comfortable resuming their normal shopping and other consumer-related activities than they were just three months ago.”
The current online survey of 610 Tennessee consumers was conducted between June 7-27 and has an error margin of 4%. To see the full report and previous reports, go to https://www.mtsu.edu/consumer/tnoutlookreports.php.
Other survey highlights:
- Nearly three-fourths (71%) are either “extremely comfortable” or “somewhat comfortable” resuming their consumer-related activities, up from 43% in March.
- Consumers’ concerns about needing to wear masks in public have also declined significantly since March. Only 36% said it is either “extremely important” or “very important” for people to wear masks when in public, down from 73% in March. Further, 24% said wearing masks is “not at all important.”
As more and more consumers feel comfortable resuming their shopping, dining, travel, and other consumer-related behaviors, and they feel a decreased need to wear masks, this can help to spur economic activity, Graeff noted.
The Consumer Outlook Index scores are based on consumers’ responses to 11 questions measuring their perceptions of the current economy, the future economy, jobs, personal finances, and whether now is a good time to make large purchases. The index, which includes three subindices, is computed by adding the percentage of favorable responses to each question and subtracting the percentage of negative responses to each question.
For more information, contact Graeff at 615-898-5124 or Tim.Graeff@mtsu.edu. Or visit www.mtsu.edu/consumer.
— Jimmy Hart (Jimmy.Hart@mtsu.edu)