Consumer confidence is continuing to edge upwards, according to the results of the latest Irish Times TNS mrbi index. They show that the number of people expecting conditions to improve over the next year now matches those anticipating a decline, writes Cliff Taylor, Economics Editor.
The survey, taken between February 10th and March 4th, shows that 27 per cent expect conditions to improve over the next year, one point up on the previous survey and the sixth straight month of improvement. Meanwhile, exactly the same number - 27 per cent - expect conditions to weaken in the year ahead, two points down from the previous survey.
A significant number of respondents, 41 per cent, answered that they expected conditions to remain the same, with 5 per cent "don't knows".
The monthly "Pulse" survey, conducted as part of a TNS mrbi phone poll, asks respondents: "Thinking about the year ahead, do you think employment levels and the Irish economy in general are set to improve, weaken or remain the same?"
It has shown a steady pick-up in confidence since last summer, when the August survey showed 70 per cent expecting conditions to weaken against just 7 per cent anticipating an improvement.
The continued improvement - albeit small - in the latest survey contrasts with the the results of the latest IIB/ESRI consumer sentiment index, which fell back to 82 in February from 85.7 the previous month. This fall-off appeared to largely reflect a part of the survey that asked consumers about major purchasing intentions, which showed a seasonal fall after the January sales. The latest Pulse survey appears to confirm that underlying confidence remains firm.
Improving consumer sentiment is to be expected against an improving economic backdrop. There have been growing signs of an international recovery, while, domestically, jobs figures published this week suggest that the Irish economy and the jobs market are picking up. Analysts are now debating the likely strength of the world recovery, particularly against the backdrop of recent disappointing US jobs figures.
The breakdown of the latest survey shows that males are notably more upbeat than females on the outlook. Some 30 per cent of males expect a pick-up over the next year, ahead of the 26 per cent anticipating a fall-off. This is in contrast to females, where the pessimists at 27 per cent outnumber the optimists at 24 per cent.
Retired people have been consistently the most upbeat in the surveys and the latest survey shows 35 per cent expecting conditions to improve against 24 per cent looking for a decline and 35 per cent anticipating conditions will stay the same.
Among the student population, those looking for an upturn (27 per cent) have overtaken those expecting conditions to weaken (26 per cent) for the first time.
Looking at the regional breakdown, the figures show that Connacht/Ulster and Dublin are the more upbeat regions - with those anticipating an improvement outnumbering the pessimists in both. The position is reversed in the rest of Leinster and Munster, but the differences are not large and all regions have shown a sustained improvement in recent months.
Looking at the breakdown by the traditional social groups, the AB category is notably upbeat, with 33 per cent expecting economic improvement against 26 per cent anticipating a weakening. There is also a small positive majority in the "C1 grouping" but the pessimists prevail in the C2 and DE categories.
Perhaps pointing to an economic pick-up, 33 per cent of those classified as "businesspeople" expect a pick-up in the year ahead against 24 per cent anticipating a fall-off. This is partly reflected in the positive majority in the "chief income earner" group (28 per cent to 25 per cent), which is exactly reversed in the "not chief income earner" category.
