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Southeastern US Consumer Confidence Slowly Improving

Southeastern confidence still lower than national average 


RALEIGH, N.C. – June 21, 2010 – With economic experts saying the recession is technically over, Southeastern U.S. residents, are slowly regaining their faith in the economy with consumer confidence improving relative to the record low levels observed in 2009, according to RBC Bank’s Southeastern Consumer Outlook Index (RBC COI), which compiles data for the six U.S. Southeastern states of North and South Carolina, Georgia, Florida, Alabama and Virginia. However, confidence levels have yet to improve back to “healthy” levels observed earlier in the decade.

The current RBC COI for the Southeast (57.0) posted gains relative to the lows recorded by previous measures as part of former tracking of consumer confidence dating back more than seven years, in late 2008 (24.8, measured July – December 2008) and 2009 (31.1, measured July – December 2009) during the height of the recession (and the last times that data was compiled), indicating that consumer confidence is gaining some ground. However, Southeastern consumer confidence still remains low particularly compared to national confidence levels (57.0 points compared to 65.3 points as measured between April and June 2010).

“The relatively slow improvement in confidence thus far indicates that some Southeastern U.S. residents still view the economic recovery as uneven,” said Tom Porcelli, director and head of US Market Economics. “A major contributing factor to the lower level of consumer confidence is likely the fact that unemployment rates remain higher in the southeast compared to the national average. While we have seen signs of improvement, further gains in employment will be critical before we see a more significant boost in confidence levels.”

The new RBC COI utilizes a 26 question battery among an online panel weighted to be representative of the U.S. national population. The study analyzes consumers’ perception of Current Conditions, the Job Market, Investment Confidence and Expectations.

  • RBC COI Current Conditions - Consumers across the region have little confidence in the health of their local economies. Particularly pessimistic are Florida residents where two-in-three (66%) residents say their local economy is very weak.
  • RBC COI Jobs - Southeastern consumers continue to have significant concerns about employment prospects. Residents of the states of North Carolina (59%), Alabama (58%), Florida (53%) and Virginia (52%) experienced the highest levels of job loss in their immediate circle over the last three months.
  • RBC COI Investment - Consumers across the Southeast remain concerned about their ability to save and invest. Half of North Carolinians (51%) and four-in-ten Virginians (42%) and Floridians (41%) believe their ability to save will get worse over the next three months. Likewise, considerable numbers of Virginians (43%), North Carolinians (40%), South Carolinians (39%) and Floridians (36%) believe the value of their investments or savings will worsen over the next three months.
  • RBC COI Expectations - South Carolinians (29%) and Georgians (27%) are bullish on the future of their local economy. However, many Floridians (30%), Virginians (28%) and North Carolinians (27%) believe the economy in their local area will continue to weaken over the next six months.

To the future of the entire U.S. economy, Alabamans (54%) and Georgians (41%) are more likely to say that the U.S. economy will improve in the next year. Virginians (42%) and North Carolinians (35%) are the most likely to think the national economy will reverse course and weaken again in 2010.

The RBC COI is a composite measure of national consumer attitudes toward the state of local economies, personal financial situations, savings and investment, and job security. The recent three-month analysis includes a focused look at the Southeast where RBC Bank serves clients through its retail and commercial banking network.

About RBC Bank

RBC Bank, headquartered in Raleigh, N.C., offers a wide range of financial services and advice to individuals, businesses and public institutions throughout the Southeast. RBC Bank’s network includes more than 420 full-service banking centers in six states (Alabama, Florida, Georgia, North Carolina, South Carolina and Virginia), an extensive ATM network and telephone and online banking. RBC Bank is the 38th largest U.S. bank by consolidated assets, according to SNL Financial’s List of the Nation’s 50 Largest Banks, September 2, 2009. RBC Bank is a wholly-owned subsidiary of Royal Bank of Canada (RBC) (RY on the TSX and NYSE), Canada's largest and most stable bank as measured by assets and market capitalization. In August 2009, Global Finance Magazine ranked RBC as the safest bank in the Western Hemisphere. RBC is also one of the world's financial, social and environmental corporate leaders, having appeared on the Dow Jones Sustainability World Index every year since its creation in 1999. Additional information about RBC Bank may be found at www.rbcbankusa.com.