Consumer Confidence Index (2011-2022)
One of the most important things to always be on top of as an entrepreneur is the state of the economy—both present and future. Not only does it tell you how it may impact your business, but it can also arm you with the information you need to adjust your strategy going forward.
The consumer sentiment index is a common measure of this. According to the US consumer sentiment index by the University of Michigan, US consumer confidence had been growing over the past decade until the coronavirus pandemic hit.
The index is calculated by asking consumers about their current financial situation, benchmarked against what it was a year ago, as well as their expectations over the coming year. The number of negative responses is then compared against positive ones. The higher the index is, the better the economic situation and outlook.
In 2011, the consumer sentiment index was measured at 67.3. Up until 2019, aside from slight dips in 2016 and 2019, the US consumer index had been increasing steadily year after year.
Following the outbreak of COVID-19 in 2020, the US consumer sentiment dipped to 81.6, a 14.4-point fall from 2019. This fell further to 77.6 in 2021.
Here’s a closer look at how US consumer confidence has evolved recently.
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US Consumer Confidence From 2020 to 2022
The US consumer confidence index in 2020 started off on a high note, coming in at 96.4 in the first quarter of the year.
But as the effects of the coronavirus pandemic hit, consumer sentiment fell to 74 in the second quarter. Not only was this a drastic 22.4-point plunge, but it was also the biggest fall in at least a decade and the lowest point the index had been since Q4 2011.
US consumer confidence inched upward quarter after quarter from Q2 2020, and the year rounded out at 79.8. The rising sentiment continued through the first half of 2021, registering at 85.6 in the second quarter. This upward tick, however, did not last. US consumer confidence index fell to 74.8 in the third quarter and a further 4.9 points to 69.9 in the final quarter.
In the first quarter of 2022, sentiment fell to 63.1, before dropping further to 57.8 in Q2 2022. At 56.1 in the most recent quarter, Q3 2022, it is the lowest point of the index since Q4 2008.