Florida consumers are increasingly pessimistic about the state of the economy, according to a survey by the University of Florida.
The most recent Florida Consumer Sentiment Index (CSI) survey showed that Floridians' views of current economic conditions dwindled in May, falling to 72.7 points from a revised 74.1 in April.
That continues a decline that has been happening for the last three months.
Hector Sandoval is the Director of the Economic Analysis Program at UF’s Bureau of Economic and Business Research.
He said Floridians are not the only ones to feel pessimistic about the economy, as the state’s consumer confidence matches the national rate.
Consumers in both Florida and nationwide are worried about the ongoing increase in gas prices due to the U.S./Israel war with Iran.
The average price of a gallon of unleaded gas was $2.89 in Florida on February 28, when combat operations started. According to AAA - The Auto Club Group, the price was just under $3.94 Wednesday.
“That's kind of putting pressure on the budget of the households,” he said. “And so that's one reason to think the economy is not as good as before.”
However, he said Florida residents have an additional aspect of the economy affecting their spending habits — the rising unemployment rate.
“The unemployment rate in Florida is always lower than the national level,” Sandoval said. “But that actually changed recently, where now the unemployment rate in Florida is higher than the national rate.”
The state’s unemployment rate rose to 4.8% in April, surpassing the national rate for the fourth month in a row. The national rate came in at 4.3% in April.
When Florida’s jobless rate surpassed the national number in January, that was the first time it happened in five years.
The UF study includes responses from 326 people reached by cellphone across different areas of the state.
Sandoval said the research doesn’t look at exactly why Florida consumers feel the way they do about the economy, it just tracks their mood.
He also said the study doesn’t account for expected costs like rent, utilities and food, just additional purchases like appliances or furniture.
This month, it shows Floridians are choosing to save money instead of spending due to anxiety about what the future holds.
“And the idea is, if you don’t feel like the economy is in good shape, you want to save money,” he said. “But that then has the effect on the economy that you are not spending.”
Opinions also depended on demographics, with Sandoval saying gender, income and age as factors.
While the survey showed expectations for both the personal and national financial situations a year from now fell between April and May, women and people with an annual income under $50,000 were more optimistic about both.
People 60 and older had a more positive outlook on their own finances a year from now, while people younger than 60 were more positive when it came to the short-term national outlook.
When it comes to the long-term outlook — conditions over the next five years — expectations for the entire survey group were up very slightly. But men and people younger than 60 had a less favorable opinion.
In contrast, expectations regarding U.S. economic conditions over the next five years increased slightly, rising 0.1 point from 76.8 to 76.9. However, these views were split by demographic groups, with men and people younger than 60 reporting less favorable expectations.
And while consumer confidence is on the decline currently, Sandoval said it is still higher than it was in the years following the Covid-19 pandemic.
“For now it’s (down) three months…” he said. “That seems like a lot, but we have seen this in other times and if it really keeps declining, we need to start to look more carefully at this.”
