NEW YORK — Americans in the living room and the boardroom are growing more fearful about the economy, creating a Catch- 22 for the job market: Shoppers won’t spend until they feel more secure, and business won’t hire until people start spending.
The eroding views were revealed Tuesday by two surveys, one that found everyday Americans are increasingly pessimistic about jobs and another that found chief executives have grimmer predictions about upcoming sales.
“The economy is stuck in an unvirtuous cycle,” said Mark Vitner, an economist at Wells Fargo. “Consumers are waiting for more jobs to be created, and businesses are waiting for consumers.”
The monthly Consumer Confidence Index from the Conference Board, a private research group, fell to 48.5 in September, its lowest point since February and down from 53.2 in August. Economists surveyed by Thomson Reuters were expecting 52.5 for September.
It takes a reading of 90 to indicate a healthy economy — a level not approached since the recession began in December 2007.
Retailer Toys R Us says it will hire 45,000 employees for the holiday season to staff the 600 temporary Toys R Us Express stores it plans to open.
Meanwhile, a poll by Business Roundtable, an association of chief executives of big companies, found two-thirds of CEOs expected sales to grow over the next six months. That’s down from 79 percent in June. The CEO survey suggests companies will be wary about adding workers into 2011.
Causing uncertainty for both groups, Vitner says, are the Nov. 2 elections, when voters worried about increasing deficits and the economy’s slow recovery will decide whether to keep Democrats in power in Congress.
