The Conference Board Finds Labor Market Optimism Lifts Consumer Confidence

Slight improvements in consumers’ expectations for business conditions, labor market conditions and incomes drove a turnaround in consumer confidence in February, The Conference Board said Tuesday (Feb. 24).

The organization’s Consumer Confidence Index rose by 2.2 points in February to 91.2 after dropping in January, according to a Tuesday press release.

“Four out of five components of the Index firmed,” The Conference Board Chief Economist Dana M. Peterson said in the release. “Nonetheless, the measure remained well below the four-year peak achieved in November 2024 (112.8).”

The one component of the Index that declined was consumers’ views of current business conditions. While the share of consumers who said business conditions were “good” increased by 0.1 percentage points, the share who said conditions were “bad” rose by 1.7 percentage points.

Consumers’ views of the labor market improved, with the share saying jobs were “plentiful” rising by 2.2 percentage points while the share saying jobs were “hard to get” increasing by 1.6 percentage points.

The other three components of the Index also improved. These components are based on consumers’ expectations six months into the future. In February, a greater share of consumers expected business conditions to improve, more jobs to be available and their incomes to increase.

“Consumers’ write-in responses on factors affecting the economy continued to skew towards pessimism,” Peterson said in the release. “Comments about prices, inflation and the cost of goods remained at the top of consumers’ minds. Mentions of trade and politics also increased in February. Labor market mentions eased a bit in February, while observations about immigration increased somewhat.”

The University of Michigan found that consumer attitudes edged higher in February. Its final consumer sentiment index for month rose 0.4% from January, while current conditions improved 2.2% and expectations slipped 0.7%.

Although stability dominated the monthly comparison, absolute levels remained historically subdued.

“A sizeable month-to-month increase in sentiment for the largest stockholders was fully offset by a decline among consumers without stock holdings,” Surveys of Consumers Director Joanne Hsu said in a press release. “Similar divergences were seen across income and education, where higher-income or college-educated consumers exhibited increases in sentiment while lower-income or less-educated counterparts did not.”