WASHINGTON – U.S. consumer confidence jumped this month on a better outlook for hiring and overall growth, supporting other signs that show the economy could accelerate this year.
The Conference Board said Tuesday that its index of consumer confidence rose to 78.1 in December, up from 72 in the previous month. November’s figure was revised up from 70.4.
Consumer confidence is nearly back to where it was before the partial government shutdown in October. Steady job gains and a surging stock market have made Americans more optimistic about the economy and hiring both now and in the next six months.
“The upbeat consumer mood bodes well for spending in 2014,” said Michael Dolega, senior economist at TD Economics.
Optimism about the job market is at a five-year high. That is a positive sign for a strong December jobs report, which will be released next week.
A better job market could also drive more consumer spending, which accounts for 70 percent of economic activity.
A last-minute surge of online shopping helped boost overall holiday spending, according to MasterCard Advisors’ SpendingPulse report. Sales from Nov. 1 through Dec. 24 rose 3.5 percent compared with 2012, the firm said last week.
While many retailers have reported disappointing holiday sales, consumers appear to be spending more at car dealers, on utilities and other services and online. Americans increased their spending in November by the most in five months, according to government data, led by big gains in auto purchases.
The confidence index averaged 73.3 in 2013, according to economists at Barclays Capital, the highest since 2007. That’s above the 45.2 average in 2009, when the economy was in recession for half the year. But it is still below the reading of 90 that is consistent with a healthy economy.