Consumer Spending and Confidence Increases
Jan 11, 2011
Steady declines in layoffs have helped increase confidence and increase spending for American adults with jobs. High consumer spending leads to increases in company profits, leading to more hires, which in turn creates more spending and growth. Consumer spending is important because it makes up 70 percent of the U.S. economy.
Morgan Stanley estimates that 4 percent growth is very likely in 2011. Fewer employees are worried about losing their jobs because most companies have stopped laying people off and those who have survived job cuts for the past three years aren’t afraid of losing their job now. Many households have decreased their credit card debt over the past few years and are now willing to spend. So far so good, it looks like 2011 will be another year towards recovery.