Affluent Americans feeling 'less bad' about economy
A man looks at watches outside of a store in March 2009 in Greenwich, Connecticut (Photo: AFP/Getty Images/File/Spencer Platt)
A quarterly luxury consumption index compiled by Pennsylvania-based Unity Marketing climbed nearly three points to 43.2 points in the first quarter of the year compared with a historic low of 40.3 points in the second quarter of 2008 and 41.7 points in the last three months of last year.
"Affluents are beginning to feel somewhat better -- or, more correctly, less bad -- about their personal financial situation now," Unity Marketing said in a statement.
"Likewise, they feel the country as a whole is moving in a more positive direction," the statement said.
To compile the quarterly index, 1,034 Americans whose incomes averaged 207,000 dollars were polled from April 3-8.
The survey, which has been conducted since 2003, when it was set at 100 points, includes questions about finances, lifestyle, and luxury purchases and spending.
Thirty-nine percent of well-off Americans said they were optimistic that they would be better off in 12 months than they are now.
The exact same percentage said their personal financial situation had declined somewhat with the economic crunch, while a quarter of those surveyed, many of them men aged over 40, said their situation had declined significantly.
By comparison, 54 percent were positive about the future in 2007, and 37 percent in 2007.
Although "affluents" are feeling better about the economy, 43 percent said they plan to rein in spending on luxuries in the next 12 months.
"There is a growing social consciousness and sense of responsibility, in the sense that the affluent see their neighbors losing their jobs and homes -- 2-3 million dollar homes, at that -- and they have a sense of 'it can happen to me, too'," Unity Marketing president Pam Danziger told AFP.
"We are seeing a long, slow crawl to higher levels of affluent consumer confidence. At the same time, there is trouble ahead for luxury marketers, as the affluents are holding back on spending more on luxuries," she said.
While producers of luxury goods are likely to face a slog to win back wealthy Americans, there is light at the end of the tunnel if the recession bottoms out soon, said Tom Bodenberg, Unity Marketing's chief consumer economist and director of research.
"When the recession has played its course, there will be pent-up demand for luxury goods," he said.
But if the recession lingers, the US market for luxury goods, many of which are imports, could be affected by the current focus on 'recession chic',which excludes open shows of luxury.
"The media focus on recession chic may leave a lingering distaste for conspicuous consumption and parading luxury labels," said Bodenberg.WASHINGTON, April 22, 2009 (AFP)
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