UK consumer confidence plummets
Consumer confidence in the UK took a dive during the final quarter of 2009 as people worried about their job security, research showed today.
Just less than a third of British people said they expected their economy to deteriorate further during 2010, up from only 22% of people who felt this way in the three months to the end of September.
There was also a sharp drop in the number of people who were optimistic that the economic situation would improve, with this falling to 39% during the final quarter, down from 52%, according to the Association of British Insurers.
The group said the number of people who were worried about their jobs also increased during the period, with 31% saying they were now more concerned about their job security than they had been three months ago, up from 27% in the third quarter.
Consumers' increased pessimism has led to a rise in the number of people who are focusing on paying off credit card and loan debts, with 42% of people saying they were trying to clear their unsecured debt more quickly, up from 34% a year earlier.
Among those who are saving regularly, only 17% expect to be setting aside more during 2010 than they did last year, compared with 24% who planned to increase their saving levels during the coming year in the third quarter.
However, despite the fact that the majority of people are not trying to put aside more money, 37% still see themselves as savers, with just 31% saying they are spenders.
Less than one in five people also said they would rather go into debt than go without something.
However, seven out of 10 people admitted they would cope badly if they lost their job, and four out of 10 said they had not made adequate financial provisions that would enable them to cope with a large unexpected expense.
Dr Rebecca Driver, chief economist at the ABI, said: "Despite continued fiscal and monetary policy intervention, consumer perceptions of the economic prospects and their own job security in 2010 have deteriorated."
