NEW YORK—The Federal Reserve Bank of New York today released results from its monthly Survey of Consumer Expectations (SCE) which provides insight into Americans’ views on inflation, prices, the labor market and household finance. Consumer inflation expectations rose slightly in March at both the one-year and the three-year ahead horizon, whereas home price change expectations declined slightly. Median earnings growth expectations rose slightly to 2.4 percent, the highest level since the start of the survey in June 2013. The mean perceived chance of finding a job in three months, if one were to lose their current job today, increased slightly to 49 percent. Household income and spending growth expectations remained essentially unchanged, while current credit access perceptions improved slightly.
Additional results from March 2014 include:
Inflation
- Consumer inflation expectations rose slightly at both the one-year (3.2 percent) and the three-year (3.4 percent) horizon. The increase appears to be driven by respondents with lower education.
- Home price change expectations declined slightly at all quartiles for the second month in a row, matching their lowest level seen in October 2013. This pattern does not hold in the West, where home prices are expected to grow at a stronger pace.
- Commodity price change expectations remained stable.
Labor Market
- Median earnings growth expectations rose slightly to 2.4 percent, the highest level since the start of the survey in June 2013. The upper quartile has grown considerably over the past few months. Earnings growth expectations rose in all regions except for the Midwest.
- The average perceived chance of finding a job among the currently employed (if current job was lost) rose to 49 percent. This pattern is widespread across all demographics.
- The mean perceived chance of being laid off declined slightly, driven by a decline in expected layoff risk reported by college graduates; however, the mean likelihood of voluntary quits also fell slightly.
Household Finance
- Household income growth expectations remained stable except for younger household heads (under 40), whose expected income growth rose to 4.6 percent.
- The median expected change in taxes declined from about 4 percent to a little over 3 percent (annual rate), the lowest level since the start of the survey in June 2013.
- Perceptions of credit availability improved slightly, with fewer people finding it harder to obtain credit today compared to a year ago. Debt delinquency expectations also declined slightly.
About the Survey of Consumer Expectations
The SCE contains information about how consumers expect overall inflation and prices for food, gas, housing and education to behave. It also provides insight into Americans’ views about job prospects and earnings growth and their expectations about future spending and access to credit. The SCE also provides measures of uncertainty in expectations for the main outcomes of interest. Expectations are also available by age, geography, income, education and numeracy. The SCE is a nationally representative, internet-based survey of a rotating panel of approximately 1,200 household heads. Respondents participate in the panel for up to twelve months, with a roughly equal number rotating in and out of the panel each month. Unlike comparable surveys based on repeated cross-sections with a different set of respondents in each wave, our panel allows us to observe the changes in expectations and behavior of the same individuals over time.
The survey is conducted on our behalf by The Demand Institute, a non-profit organization jointly operated by The Conference Board and Nielsen. The sampling frame for the SCE is based on that used for The Conference Board’s Consumer Confidence Survey (CCS). Respondents to the CCS, itself based on a representative national sample drawn from mailing addresses, are invited to join the SCE internet panel.
