NEW YORK (Reuters) - Half of U.S. families with young children plan to spend less on holiday shopping than they did last year, and some will spend nothing at all, because of concerns about the economy, according to a new poll.
With unemployment hovering at around 9.6 percent and a stalled economic recovery, Americans are reluctant to dispense with their hard-earned money.
“Confidence is effectively shackled by continued uncertainty around a weak economic recovery that has produced the second-fewest number of jobs at this point in a post-war recovery,” said Marc Harris of RBC Capital Markets, which conducted the survey.
The findings of the RBC Consumer Outlook Index make grim news for retailers who rely on the holiday season for their biggest sales.
In addition to cutting back on holiday spending, 69 percent of 1,032 Americans who were questioned in late October said they believe the economy and their own finances will be stagnant or worsen in 2011.
“The real indicator of where consumer confidence is headed will come in the next few weeks, as Americans digest the results of the midterm elections,” Harris added.
Voters gave Democrats what President Barack Obama described as a “shellacking” on Tuesday when Republicans regained control of the House of Representatives and increased their numbers in the Senate.
The index also showed that Americans are still not confident about investing in property and 48 percent said they are unsure about putting their money in the stock market.
But on a more positive note, confidence in job security inched up and more Americans are thinking about making a big purchase such as a car.
“The positive movement in the Index is driven by the significant increase in the number of Americans who think it is unlikely that anyone in their inner circle will lose their job in the next six months,” according to RBC.
Consumers who said they planned to make a major purchase in the next six months rose to 11 percent from a previous 8 percent last month.
Reporting by Patricia Reaney; Editing by Leslie Gevirtz