Survey respondents said they are pessimistic about where the economy will be in six months.
May 27, 2011 - Springfield - Staff photo by Michael S. Gordon - Joseph P. Flanagan of Glastonbury, Ct. fills his gas tank at the Pride Gas station of East Columbus Ave.SPRINGFIELD – People in Western Massachusetts have a gloomier view of the economy than their counterparts across the state according to poll results released last week by Mass Insight, a Boston-based consulting firm.
And how people feel about the economy can in turn, impact the economy, said William H. Guenther, president of Mass Insight.
“It’s a feedback loop. Bad news makes people think twice about spending money. Poor sales result in poor economic news,” Guenther said in a phone interview. When asked by pollsters if the economy would be better or worse six months from now, 34 percent of Western Massachusetts residents, defined here as the 413 area code, said “worse”. That’s the highest percentage saying “Worse” of any region in the state.
Also, 37 percent said “the same” and 28 percent said “better”. That’s compared to statewide averages of 21 percent “worse”, 45 percent “the same” and 32 percent “better”.
Ironically, people in Western Massachusetts were more willing to spend on a big-ticket item. When asked if now is a good time to make a big-ticket purchase like a refrigerator or furniture, 51 percent of the people in Western Massachusetts said it is a “good time” to buy and 46 percent said it is a “bad time”. The statewide averages were 42 percent “good time” and 51 percent “bad time”.
Guenther said the percentage of people willing to spend on a big-ticket item will have to get much further north of 50 percent before the economy can be called healthy.
“If you go into a store today to buy a television, I bet you get a pretty good deal,” he said.
The statewide samples are have a margin of error of plus or minus 4.4 percent and are based on a telephone survey of 500 adults. Western Massachusetts’ results are less accurate, instead based on a 108-person subset of that 500-person sample.
Percentages also reflect rounding and some people questioned invariably answer “do not know”.
The same poll yields Mass Insight’s consumer confidence index which fell to 67 points on a scale where 100 is considered “normal” sentiment. The index was just two points higher than the 65-point national average figured by the Washington-based Conference Board. The Conference Board’s New England Average was 57 points.
In January, the last time Mass Insight did its index, the confidence level was at 74 points compared with 65 nationally and 79 across New England.
“For the whole decade of the 2000s we only broke 100 three times,” he said.
Guenther also pointed out that the overall consumer confidence is the result of divergent views where the economy is versus where it is headed. The Current conditions index for Massachusetts went up from 17 in January to 24 points in April. But the Future Expectations Index fell from 112 in January to 96 points in April.
When asked what the economy is like now: 52 percent of Western Massachusetts residents said “bad”, 43 percent said normal and just 2 percent said good. The statewide averages were 47 percent “bad” 41 percent “normal and 10 percent “good”.
When asked about the availability of jobs, 59 percent of respondents in Western Massachusetts said jobs in this area are “hard-to-get” 35 percent said “not so many jobs” and 3 percent said “plenty of jobs”. The statewide averages were 50 percent hard-to-get, 36 percent “not so many” and 6 percent “plenty of jobs”.
“That’s what people are seeing every day, jobs, gas prices and a stalled housing market,” Guenther said.
Unemployment for the Springfield federal statistical area, which includes most of Hampden County, fell to 8.5 percent in April from 9.4 percent a month earlier and 9.1 percent a year ago, according to statistics released last week.
Gas averaged $3.84 a gallon in the Springfield area Friday, according to AAA. One year ago it averaged more than a dollar less at $2.80 a gallon.
The median price of a single family home in the pioneer valley nudged up 0.6 percent from $181,000 in April 2010 to $182,000 in April of 2011, the most recent figures available.
But some see evidence of the slow economic recovery economists keep talking about. John Klimas, vice president for lending at STCU Credit Union in Springfield said people are borrowing money, maybe not mortgages, but car loans and home-improvement loans.
“I see some stirring out there,” Klimas said. “It’s not at the level it should be. But business is getting better.”