CONSUMER CONFIDENCE slipped back in February as "a seemingly relentless tide" of job loss announcements left consumers with a more downbeat picture of their personal finances.
The IIB Bank/Economic and Social Research Institute (ESRI) consumer sentiment index made an expected plunge this month in sympathy with global economic anxiety, although the main worry for Irish consumers lay closer to home.
A "sharp worsening in job market prospects" was the main reason confidence deteriorated, according to IIB chief economist Austin Hughes.
"Clearly, fears in regard to a seemingly poorer outlook for the US economy might have raised concerns about employment in US companies in Ireland.
"However, it seems more likely that a barrage of job-loss announcements was the dominant influence," he said.
The spate of layoffs announced during the survey period included 580 redundancies at Arnotts, 360 job losses at Allergan, 200 job losses at Jacob Fruitfield, 130 redundancies at Grove Turkeys and 120 job cuts at Sercom Solutions.
Fears of significant cuts at several other companies, including up to 200 jobs at aircraft maintenance company SR Technics, and nervousness about a contraction in employment in the construction sector also darkened consumers' mood, Mr Hughes added.
There were also several job creation announcements during February, but the now "extremely rapid" turnover in the Irish employment market means there is reduced job security in the current climate, he said.
"In circumstances where new hiring looks likely to ease back, an array of signals pointing to increased firing makes Irish consumers much more fearful."
Noticeable increases in food and fuel prices may have prompted consumers to assess the trend in their household finances over the last 12 months in a more negative light, according to Mr Hughes.
But consumers were slightly less pessimistic about the outlook for their personal finances, reflected fading fears of further interest rate increases and the possibility that borrowing costs may fall in 2008. There was also a surprising lift in consumers' assessment of the general economic prospects, which Mr Hughes said could suggest Irish people are braced for bad news on the economy.
