Retailers, listen up. A survey from Discover shows that more consumers believe economic conditions are still getting worse.
 
Discover’s U.S. Spending Monitor for October fell 3.2 points to 85.8 (that’s out of 100, which is where the index started in May 2007).
 
Forty-six percent felt economic conditions were getting worse. That’s up 3 points from September and the first time the survey has seen an increase since July.

Slightly more women (58 percent) than men (53 percent) rated the economy as poor. Overall, 56 percent called the economy poor, up from 52 percent in September.
 
“The Monitor has always shown that women tend to be less optimistic than men about the economy and their finances,” said Julie Loeger, senior vice president of brand and product management for Discover.  “But the record jump in the number of women rating the economy as poor and the pessimism over the current state of their finances may indicate a weak holiday shopping season ahead.”

The Discover U.S. Spending Monitor is based on interviews with 8,200 U.S. adults conducted thoughout October.

Nearly 63 percent of 5,000 consumers surveyed toward the end October plan to spend less on holiday gifts this year. That’s in line with last year’s projections, and we all know how the winter of 2008 turned out.

For the seventh month in a row less than half of consumers said they expected to have money left over after paying their monthly bills. Just 44 percent said they expected to have money left over, down 3 points from September.

Meanwhile, the U.S. Agriculture Department said more Americans than ever are receiving food stamp assistance, while personal spending fell 0.5 percent in September.
 
“Consumers simply don’t seem to have the economic or financial confidence right now to reverse course, which is not good news for retailers,” said Loeger.

(Photo/Reuters)

While more consumers feel better about the economy, they are not getting back to their spending ways, according to a survey released on Wednesday.

Discover’s U.S. Spending Monitor for August showed a rebound, with results rising to 87 (out of 100) from July’s 83.5.
 
A whopping 21 percent felt economic conditions were improving, marking a high for the monitor and up 7 points from July.  And, just over 21 percent felt their own finances were shaping up, marking the highest number reported since August 2008 (aka the month before the Lehman bankruptcy frazzled the markets).

Still, for the third month in a row, over 50 percent of respondents said they plan to cut discretionary personal spending in the month ahead.

Where is the money going?  Many seem to be putting it in the bank.  The percentage of consumers planning to save and invest the same amount or more in the month ahead shot up to 58 percent, 3 points higher than July.
 
“The rise in the stock market and stable gas prices may have given consumers a reason to believe things are improving and the ability to save and invest more,” said Julie Loeger, senior vice president of brand and product development for Discover.  ”But improved economic and financial attitudes has not translated into increased consumer spending, a cause for concern for retailers counting on revenue from back-to-school shopping and as the holiday shopping season approaches.”
 
Still, just 46 percent reported having money left over in August after paying their monthly bills, a Monitor-low and 5 points lower than a year ago.  Even 22 percent of those who had money to spare have less of it.  That’s up 3 points from July and the highest level since December.

Want a bit of good news?  Only 46 percent of consumers felt economic conditions were getting worse.  That’s down 6 points from July and is also a Monitor-low.  In August 2008,  65 percent of consumers felt economic conditions were getting worse.  Also, 46 percent said they felt their own finances were heading south.  That’s a 5 point improvement from July and the lowest it has been since December 2007.

(Reuters photo)

Check out the continued concern over the U.S. economy.

Discover’s US Spending Monitor, released on Wednesday, showed that the economy is weighing more on consumers’ minds when it comes to everyday purchases.  The monitor, which began in May 2007 with a base index of 100, fell for the first time in four months, to 85.6 from 86.2.

Fifty-nine percent of the 8,200 respondents rated the economy as poor, up from 55 percent in May and the first increase since February.  Still, 33 percent rated their own finances as good or excellent, in line with May’s responses.

Gas prices inching back up took their toll.  Thirty-five percent of consumers polled in June said they expect to spend more on items like gas and groceries, up 5 points from May and a 10 point jump over the last two months.

“The optimism we were seeing from consumers in terms of the economy over the past few months may have hit a roadblock in June,” said Julie Loeger, senior vice president of brand and product management for Discover Financial Services.  “With unemployment still rising and uncertainty as to whether the economic recession is ending, consumers are seeing no reason to change the spending restraint they’ve exhibited over the last several months.”
 
Consumers said they would spend less on going out to dinner or the movies and other discretionary spending habits.  Fifty-one percent said they plan to spend less in the month ahead on discretionary purchases, up 2 percentage points from May. 

One note of hope is that for the second month in a row, less than half of the respondents said they felt that economic conditions are getting worse, Loeger said.  However, only 47 percent said they have money left over after paying their monthly bills, a 1 percent decline from May.

The results are culled from polls of 8,200 consumers, with 275 interviewed each night during the month by survey research firm Rasmussen Reports.

Also in the basket:

Family Dollar profit beats market view

Pepsi Bottling tops expectations

Obesity worries lift health food prospects in Asia

Test your foodie IQ (Chicago Tribune)

(graph from Discover’s US Spending Monitor)

Check out the list of things consumers are still spending money on during the recession.

Auto repairs, home repairs and going to the dentist are among the seven areas consumers are still spending their money even as consumers worry about their jobs, according to Sageworks.

Auto repair shops’ sales grew an average of 2.4 percent over the last 12 months, compared with a 9.7 percent decline at car dealerships, Sageworks said. Meanwhile building equipment contractors, such as electricians and plumbing and heating contractors, saw sales rise 4.6 percent in the last year, while home builders’ sales fell more than 5 percent in the same period.

Grocery stores were more popular than eating out as the former had average sales growth of 6.7 percent over the last 12 months, compared with growth of 3.9 percent at sit-down restaurants, Sageworks said.

Others areas of growth:

* Trade and technical schools saw their sales grow 7.8 percent in the last 23 months, compared with growth of 5.9 percent in 2007.

* The average dentist office experienced sales growth of 6.9 percent in the last 12 months, up from 4.9 percent growth in 2007.

* Hair salons, barber shops, nail salons and skin-care providers saw an average of 4.5 percent sales growth in the last 12 months.

* Accounting firms saw average revenue grow 10.2 percent in the last 12 months, ranking the industry among the 20 fastest growing in the country.

Also in the basket:

Ackman says Target proxy not about him

Warnaco profit tops Wall Street view

Target matches competitors’ prices in pilot program

Sara Lee names interim CFO

O’Charley’s posts surprise Q1 profit

(Reuters Photo)

Coach Inc Chief Executive Lew Frankfort is optimistic about a future under Barack Obama. 

In an interview with Reuters on Wednesday, Frankfort said he was confident the new  U.S.  president can help ease the minds of consumers, who spent much less on Coach bags and accessories during the 2008 holiday season than they did a year ago, leading the company to scale back expansion and lower prices.

“I think so much of how consumers behave is based upon their psyches, and there’s enormous fear that we don’t know where bottom is and that things can worse,” Frankfort said. “I have a lot of confidence that he (Obama) will instill programs and initiatives to give people confidence. He himself gives people confidence.”

Yet in light of the 5-percent stock market decline on Tuesday, the day Obama was sworn in as the 44th U.S. president, Frankfort cautioned that a real recovery in consumer sentiment will require actual improvements in economic conditions.

“Consumers are not going to feel better until the credit markets loosen up and the housing markets stabilize,” he said. “Consumer credit is still extremely tight. Credit availability has loosened up somewhat, both commercially and personally, but no one has a feeling that it’s systemic.”

(Photo: Reuters)

(Adds comments from Friday afternoon)

Shoppers thronged stores to pick up discounted flat-screen TVs, electronics and clothes as panicked retailers pull out the stops in what is traditionally the biggest shopping weekend in the United States. Reuters reporters are out in force, gauging consumer sentiment. Here are our favorite quotes so far:

“I’m not going for the Santa Claus award,” said college student Corey Talley, 24, who was shopping at the Mall at Prince George’s in Hyattsville, Maryland, and plans to spend less this year because he bought a four-unit apartment building in a low-income neighborhood in November 2007 and had only one tenant.

Nursing students Williamena Davids, 23, and Vivian Teah, 25, arrived at the mall at 5:12 a.m.
“I thought there was going to be some sales. No luck,” said Davids, who had been working for Geico as a customer service representative but lost her job this year.
Teah said her budget was also pinched: “I have a big family. I have to make sure that everybody gets something. It’s fun (to go shopping). We just wish we had money.”

“I will not go near stores on Black Friday. People are crazy,” said Lori Kirby, who was in Kmart near Manhattan’s Penn Station on Thursday to pick out a last-minute holiday outfit for her aunt. “Unless you get there first, it’s like running with the bulls or something.”

“The recession is kicking in,” said Tammy Williams, 36, as she waited before dawn to enter a Kohl’s in West Paterson, New Jersey. “I’m just looking for a bargain, anything to save a couple of dollars. I’ll save the rest for food shopping.”

“I think everybody is waiting for deeper discounts. I certainly am,” said Cheri Tenfel, a nurse, who was shopping at a Best Buy in Racine, Wisconsin.

“I’m horribly worried about the economy. It’s going to take a long time to recover, I think,” said Carri Bissen, who was shopping at a Racine mall. She said her husband is out of work and that she’s only getting gifts for their children this year. “My kids are getting more clothes and shoes rather than the fun stuff they’d normally get.”

Alice Hughes, 45, was out shopping in Columbia, Maryland, and said she was not impressed with Black Friday prices and that she expects the discounts to deepen as Christmas approaches: “They tell you they’re marking down but they’re really not.”

“I just want to buy everything on sale today,” said Marjorie Daube, 59, of New York, who is expecting her husband’s bonus to be smaller this year. “We are cutting down, buying necessities and things on sale for my daughters … Shopping was never fun at all, and it’s less fun now.”

“It’s almost like a guilty feeling when I hand over my money,” said Janet Duran, who was visiting from Scotland and shopping at an Old Navy store in midtown Manhattan. “I think: Should I be doing it?”

Jen O’Neil, 18, and her friend Lauren Chin, 17, arrived at the Roosevelt Field Mall in Long Island, New York, at about 9:30 a.m. on Black Friday and were loaded down with bags by noon. About half of their purchases were for themselves and the other half were holiday gifts. “I got less (spending money) from my parents this year, but I put in my own money,” Chin said.

Mandeep Singh, 14, was also at the Roosevelt Field Mall, where he bought a jacket and jeans. “As a kid I don’t have the much (money) in the first place, and this year it goes a lot further,” Singh said.

Marisol Quinones came from the Bronx to shop at the Atlantic Center Mall in downtown Brooklyn at 4:30 in the morning and didn’t find the deep discounts she expected. 
 
“It was alright … I thought it would be cheaper.” Quinones and her friends all said they planned to spend less on holiday gifts than last year. “Food is going up, everything’s going up, but money’s still the same. Things (prices) are so high, so being with family is better than spending all that money.”

(Photos\Reuters; Reporting by Aarthi Sivaraman, Diane Bartz, Nicole Maestri, Michelle Nichols, Karen Jacobs, Ellen Wulfhorst, Alexandria Sage, Ilaina Jonas and Martinne Geller)