Consumer confidence rises as improving state of economy boosts personal finance and job prospects
Quarterly survey shows increase of four points in Consumer Confidence Index for Q1 of 2014
Consumers in Dubai see their personal financial situation improving and brighter job prospects on the road ahead as per the latest findings of the quarterly consumer confidence survey conducted by the Department of Economic Development (DED) in Dubai.
Overall Consumer Confidence Index increased by four points during the first quarter of 2014 to reach 143 points, building on a steady upswing seen in recent years. While job security and increasing utility bills remain major concerns 92 per cent of the consumers are optimistic on the job situation and 91 per cent on their personal finance over the next 12 months.
The state of economy in Dubai was also rated as good or excellent by 91 per cent of the survey respondents with increase in rental/property prices and the tourism boom chiefly driving positive perceptions. Consumers who believe that the state of economy will improve in the next 12 months have increased to 95 per cent from 93 percent recorded in the final quarter of 2013.
The growing confidence is further reflected in the decrease in the percentage of people who believe that Dubai economy is under the impact of recession, from 24 per cent in Q4 2013 to 14 per cent in Q1 2014. Meanwhile, the percentage of consumers who believe that the economy will recover in next 12 months increased from 63 to 77 between the two quarters.
Consumer perception on the current job scenario shows an improvement in Q1 2014 as 79 per cent rated job prospects as excellent/good compared to 75 per cent in Q4 2013. The percentage of consumers who see better job prospects in the next 12 months remained consistent at 92 per cent with 37 per cent seeing excellent prospects and 55 per cent rating them ‘good.’
Among locals almost 21 per cent rate current job prospects as excellent while 12 per cent of the expatriates have similar sentiments. Locals also have a more positive view on the current state of personal finance compared to expatriates. Consumers who see current state of personal finance as ‘excellent’ have increased to 81 per cent during Q1 2014 from 77 per cent in Q4 2013.
Growing confidence in personal finance is also encouraging more consumers to exercise options with their spare cash. Around half of the respondents plan to spend their spare cash into holidays or savings and 38 per cent are likely to make these transactions in the next 12 months.
Nearly two-third of the consumers feel it is good time to buy thing they need or want and the percentage of such consumers increased during 77 in Q1 2014 from 70 in Q4 2013. Majority of the consumers (79 per cent) cover essential living expenses but lack of job opportunities and salary levels falling short of expectations are among the concerns expressed.
A ‘Consumer Confidence Index’ provides a single indicator of consumer sentiment towards the current economic situation as well as intentions and expectations for the future and ability to track consumer confidence over a period of time.
The Consumer Confidence Index is based on responses to three questions regarding perceptions of local job prospects, personal finances and whether it is good to buy things that people need and want, all over the next 12 months. Responses vary from Excellent or Good to Not so good or Bad.
Conducted in each quarter, the survey gathers feedbacks from 2,000 respondents, equally divided between the four quarters of the year. The respondents come from all major residential communities across Dubai and cover males and females as well as nationals and expatriates, aged 18 to 59.
