National consumer outlook brightens slightly — RGV reality differs

While economic recovery may be inching forward in the data, here in the Rio Grande Valley, many families will continue waiting to see it.

This month, Americans are feeling slightly more positive about the economy compared to last month. However, they are still worried about the future.

Today, The Conference Board released July’s Consumer Confidence Index which shows a two-point improvement to 97.2 compared to June’s 95.2. While the number that assesses the future of the economy is improving, other measures in the report fell.

The Present Situation Index – based on consumers’ assessment of current business and job market conditions – fell 1.5 points. The Expectations Index – based on consumers’ short-term outlook for income, business, and the job market – rose 4.5 points to 74.4.

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While the rise in the Expectations Index sounds good, it is still well below the 80-point threshold, which signals consumers are expecting a potential recession in the next six months.

Consumers over 35 years old across all income groups but one drove the modest gain in consumer confidence. Those earning less than $15K in annual income in the same age range did not share in the positive feelings about the economy’s future.

For context, according to the U.S. Census Bureau American Community Survey, about 65,744 households in the Rio Grande Valley make less than $15K in annual income.

Across all four counties in the Rio Grande Valley, about 15% of households earn less than $15K a year, which means consumer confidence locally is more complex than the slight increase in consumer confidence nationwide. That could translate to small businesses – from taquerias to appliance shops – potentially seeing the effects of tighter budgets as people in South Texas try to save money where they can.