Consumer Confidence Improves in June

The Conference Board Employment Trends Index (ETI) increased in June, further stabilizing from sharp declines in recent months. The index now stands at 49.05, up from 45.27 in May. However, the index is still down 54.8 percent from a year ago. “The Employment Trends Index increased for the second consecutive month, but the virus’s recent proliferation threatens those gains and puts the U.S. labor market’s future in an even more precarious position,” said Gad Levanon, head of The Conference Board Labor Markets Institute. “In response to this resurgence, many governments have delayed or reversed their reopening plans, which could lead to lower hiring. Given the possibility of less recruiting and the fact that layoff rates remain high, the upward trend in the number of jobs may not continue. The unemployment rate may plateau or even increase in the coming months.”

Steel Market Update takes data from The Conference Board and presents it as a three-month moving average to smooth the trend. It’s been three months since the coronavirus shut down the U.S. economy, and the trend is clear. The composite index is made up of two sub-indexes: the consumer’s view of the present situation and his or her expectations for the future. On a 3MMA basis comparing June 2020 with June 2019, the present situation was down by 92.1 points and expectations were down by 2.5 points (Table 1). The color codes show improvement or deterioration of the individual components in Table 1. The red indicates that consumer confidence is negative in all aspects except plans to buy a house. The housing market has remained surprisingly resilient as the economy struggles with the effects of the virus.