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Consumer Confidence Dipped in May as Inflation Cools Spending on Big-Ticket Items

Pessimism also surrounds short-term business prospects, with 24.9% expecting conditions to worsen




(PRESS RELEASE) The Conference Board Consumer Confidence Index decreased slightly in May, following a small increase in April. The Index now stands at 106.4 (1985=100), down from 108.6 in April (after an upward revision). The Present Situation Index—based on consumers’ assessment of current business and labor market conditions—declined to 149.6 from 152.9 last month. The Expectations Index—based on consumers’ short-term outlook for income, business, and labor market conditions—declined to 77.5 from 79.0.

“Consumer confidence dipped slightly in May, after rising modestly in April,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. “The decline in the Present Situation Index was driven solely by a perceived softening in labor market conditions. By contrast, views of current business conditions—which tend to move ahead of trends in jobs—improved. Overall, the Present Situation Index remains at strong levels, suggesting growth did not contract further in Q2. That said, with the Expectations Index weakening further, consumers also do not foresee the economy picking up steam in the months ahead. They do expect labor market conditions to remain relatively strong, which should continue to support confidence in the short run.”

“Meanwhile, purchasing intentions for cars, homes, major appliances, and more all cooled—likely a reflection of rising interest rates and consumers pivoting from big-ticket items to spending on services. Vacation plans have also softened due to rising prices. Indeed, inflation remains top of mind for consumers, with their inflation expectations in May virtually unchanged from April’s elevated levels. Looking ahead, expect surging prices and additional interest rate hikes to pose continued downside risks to consumer spending this year.”

Present Situation
Consumers’ appraisal of current business conditions improved in May.

21.1% of consumers said business conditions were “good,” up from 20.8%.
20.7% of consumers said business conditions were “bad,” down from 22.2%.

Consumers’ assessment of the labor market was less positive.


51.8% of consumers said jobs were “plentiful,” down from 54.8%.
12.5% of consumers said jobs are “hard to get,” up from 10.1%.

Expectations Six Months Hence
Consumers’ pessimism about the short-term business conditions outlook grew in May.

17.7% of consumers expect business conditions will improve, down from 18.6%.
24.9% expect business conditions to worsen, up from 21.7%.

Consumers were somewhat less pessimistic about the short-term labor market outlook.

18.5% of consumers expect more jobs to be available, virtually unchanged from 18.4%.
18.7% anticipate fewer jobs, down from 19.8%.

Consumers were mixed about their short-term financial prospects.


19.0% of consumers expect their incomes to increase, up from 17.8%.
Conversely, 14.5% expect their incomes will decrease, up from 13.2%.

The monthly Consumer Confidence Survey, based on an online sample, is conducted for The Conference Board by Toluna, a technology company that delivers real-time consumer insights and market research through its innovative technology, expertise, and panel of over 36 million consumers. The cutoff date for the preliminary results was May 23.

Source: May 2022 Consumer Confidence Survey
The Conference Board

The Conference Board publishes the Consumer Confidence Index at 10 a.m. ET on the last Tuesday of every month. Subscription information and the technical notes to this series are available on The Conference Board website.

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