Floridians Grew More Confident in Feb.
4 of 5 components tracked by UF rose. Attitudes about the one-year-from-now economy saw the biggest gain, even in the face of inflation and rising interest rates.
GAINESVILLE, Fla. – Consumer sentiment among Floridians ticked up 1.7 points in March to 69.7 from a revised figure of 68 in February, even as the same index for the U.S. reached a new decade low, according to the University of Florida’s (UF) monthly study.
Among the five components that make up the index, four increased and one decreased.
Current conditions: On the one hand, perceptions of personal financial situations now compared to a year ago decreased slightly, seven-tenths of a point from 63.5 to 62.8.
On the other hand, opinions on whether it’s a good time to buy a big-ticket item, such as refrigerators, cars or furniture, increased 3.8 points from 53.6 to 57.4, the greatest increase of any reading this month.
Future expectations: Attitudes about Florida in March 2023 rose in all three categories in March.
Expectations of personal finances a year from now increased 2.6 points from 81 to 83.6. Similarly, the one-year expectation for U.S. economic conditions increased 2.1 points from 68.3 to 70.4, while expectations of U.S. economic conditions over the next five years increased 1 point from 73.6 to 74.6.
The optimistic expectations were shared by almost all Florida demographic groups with the exception of higher-income Floridians – those with an annual income above $50,000 – who showed some pessimism about the U.S. five years into the future.
“The increase in consumer confidence in March was primarily due to improvements in Floridians’ spending intentions and expectations of personal finances a year from now,” says Hector H. Sandoval, director of the Economic Analysis Program at UF’s Bureau of Economic and Business Research. “Interestingly, these expectations contrast with the current inflation outlook, which threatens to strain household budgets as the price of goods and services continues to rise.”
Fueled by a sharp increase in gasoline prices, the annual rate of inflation reached 7.9% in February, another four-decade high.
“With the summer travel season rapidly approaching, the prospect of higher gas prices at the pump may influence travel plans and cause some people to reduce their driving, a worrying development for Florida’s tourism industry,” Sandoval adds.
On the bright side, Florida’s labor market has remained robust, with strong demand for workers across all major industries. According to the latest Florida jobs report, the unemployment rate in February fell to 3.3%, down 0.2% from January. In line with these trends, the number of workers filing for unemployment benefits in Florida has remained at record-low levels in recent weeks.
“Russia’s invasion of Ukraine added new economic uncertainty and fresh disruptions to the global economy, which is still recovering from the COVID-19 pandemic,” Sandoval says. “Although it is unclear whether the crisis in Ukraine will have any direct impact on Florida’s economy, aside from raising energy prices, we expect consumer sentiment to remain weak in the coming months.”
Conducted Feb. 1 through March 24, the UF study reflects a demographic cross section of Florida. The index used by UF researchers is benchmarked to 1966, which means a value of 100 represents the same level of confidence for that year. The lowest index possible is a 2, the highest is 150.
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