Nearly a third of U.S. consumers feel it will be a year before their families are better off than they are today, and more than a quarter think it will take longer, according to a retail survey on behalf of Reuters.
Findings from the survey by America's Research Group released on Tuesday pointed to tough times ahead for U.S. retailers, who have their seen their sales plummet as shoppers have cut back on all but the most essential purchases.
The telephone poll asked 1,000 adult U.S. consumers a series of questions provided by Reuters. Their answers reflected the current retail free-fall pervading the industry, said Britt Beemer, founder and CEO of the group.
We're looking at a retail meltdown much worse than anyone could have imagined six months ago, Beemer said.
According to the data, U.S. consumers are pessimistic about the current economic environment and do not expect any improvement in 2009.
We're looking at the fact that most people don't think they'll see an improvement until the summer of 2010, Beemer said. That's a while.
CAN'T SAVE MONEY
Consumers were basically split between those who said their shopping budgets were lowered significantly from last year -- 50.5 percent -- and those who said they were about the same -- 48 percent.
Most said their attempts to save money were unsuccessful in the difficult economic environment. Three-quarters of the respondents said they were saving less, compared to the quarter who said they were saving more.
What we're really seeing is the extreme of the consumers' frustration in what they're doing, Beemer said.
Some 75 percent of participants said they were paying for purchases with cash more frequently, and 51 percent said they had stopped using their credit cards for purchases.
These survey results stray from the norm, Beemer said, pointing to a similar question last year that revealed that only about a third of consumers had stopped using credit cards.
Given retailers' recent emphasis on promotions in order to lure penny-pinching shoppers, Reuters asked whether consumers would consider buying an item that was not on sale.
Nearly a half, or 47 percent, said they probably would not or definitely would not buy a full-priced item. An almost equal number, 49 percent, replied it would depend on the item. Beemer said most of those would end up choosing the sale items.
When consumers waffle, about 90 percent end up moving to the sale mentality and about 10 percent move to the regular price mentality, he said.
The survey, which had a margin of error of plus or minus 3.8 percent, was conducted March 6-8.
(Reporting by Alexandria Sage, editing by Leslie Gevirtz)