Canada consumer confidence drops sharply in June

Tue Jun 26, 2012 11:04am EDT
 
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OTTAWA (Reuters) - Pessimism about the Canadian job market reached "worrisome levels" in June, the Conference Board of Canada said on Tuesday in a report that showed consumer confidence deteriorated sharply in the month.

The organization's consumer confidence index dropped 6.8 points in June to 74, the same level as in January. Confidence had risen throughout the first quarter, then dropped sharply in April and rebounded in May.

The share of positive responses about the outlook for employment was the lowest in June since the first half of 2009 when the economy was just starting to pull out of the recession.

"Negative opinion about the labor markets has risen to worrisome levels and is the primary cause behind the national drop in confidence this month," the Conference Board said in its report.

The portion of survey participants who said they expected fewer jobs in their area in six months jumped by 4.6 percentage points to 28.1 percent. Those who saw more jobs fell 3.8 percentage points to 13.9 percent.

Unlike the United States, Canada recouped all the jobs lost during the 2008-09 recession by early 2011. But hiring stalled late last year and recent data have been volatile.

After outsized employment gains in March and April - the biggest two-month growth in over 30 years - the increase in May was a negligible 7,700.

The mood on current personal finances dipped into negative territory, meaning a greater number reported a deterioration in their situation in the past six months than reported an improvement. The opinion on future finances was slightly more upbeat, but still down from the previous month.

Attitudes toward making a major purchase were unchanged from May, with the balance of opinion being slightly negative.

The Conference Board conducted its survey between June 7 and June 18, and the margin of error is plus or minus 2.1 per cent.

(Reporting By Louise Egan, editing by Dave Zimmerman)