Barbadians are slightly more upbeat about their present and future personal finances than they were five years ago but they are still largely pessimistic, a UWI consumer confidence survey has found.
The survey was conducted in June and July by a team of researchers led by Dr Dwayne Devonish, Senior Lecturer in Management Studies at Cave Hill.
Among some 500 Barbadian householders reached via telephone, there were predominantly pessimistic attitudes among consumers for June and July, largely due to the present austerity measures and the state of the economy, the survey found.
But, among “a number of interesting findings…worthy of note, especially when compared to five years ago in a previous confidence survey done in 2014″ the survey found less pessimism now than then.
Dr Devonish said: “Although Barbadians reported a negative outlook on their current and future personal financial situation in both 2014 and 2019, the scores revealed that they were relatively more pessimistic in 2014 compared to 2019, about their personal financial situation.
“However, they were less negative in their outlook on future business conditions during the current period of 2019, compared to five years ago.
“Hence, Barbadians today (compared to Barbadians in 2014), believe that businesses will do better financially, a year from now.”
But despite a dip on pessimism, the UWI researchers found most of the respondents were slightly more cautious about big spending.
He said consumers have less confidence now in making major spending decisions than they did five years ago.
Dr Devonish explained: “Pessimism with respect to decisions to make major purchases in the country (i.e buying conditions), was much higher in the current period of 2019 compared to 2014, suggesting that Barbadians today might be somewhat more reluctant to make major spending decisions or investments, compared to five years ago.”
The study also revealed that local consumers were substantially more positive in their general forecast on prices and unemployment than they were in 2014.
The UWI researcher said: “Barbadians’ confidence in the economic conditions in the next five years has increased from a negative (in 2014), to a slightly positive outlook in 2019.”
A majority of the consumers – 60 per cent- approved of the Mottley administration’s handling of the economy and its economic policies. Almost half of the sample (48 per cent) said that the Government is doing ‘only a fair job; with 12 per cent saying that they are doing ‘a good job’.
One in five householders – about 19 per cent – said the Mia Mottley Administration was doing ‘a poor job’.
The researcher said there were clear differences in the evaluations of Government’s performance for 2014 and 2019.
For example, he explained, the proportion of consumers who gave the Government ‘a poor grade’ in 2014, was much higher than this year’s.
The university senior lecturer also broke down the consumer confidence scores by sex, age, income and employment status.
He found that while Barbadians across all groups were less pessimistic now about their future personal financial situation, females were in the majority.
It was also revealed that older consumers reported a more negative attitude in the outlook of their personal finances than those under 35.
And people with deep pockets saw their financial future as bright.
Dr Devonish reported: “Persons in higher income categories were far more optimistic in their outlook, compared to those earning less than $3,500 per month when it came to their current and future personal financial situation.”
But jobless Barbadians were found to be more negative in their forecast than those with jobs in general.
He concluded: “The results of the survey demonstrate that Barbadian consumers are still pessimistic regarding the economic environment in Barbados, especially in areas of prices, their personal finances, buying and business conditions, and unemployment.”
He went on to comment that Barbadians’ overall consumer confidence in 2019 was much higher than that in 2014.
The UWI senior lecturer said: “Interestingly, Barbadians’ perceptions of the current economic conditions were similarly pessimistic between the two time points (2014 vs 2019).
“However, the results also show that consumers’ perceptions of the economy in the next 12 months were much more positive In the current period 2019, compared to that in 2014.”
Dr Devonish recommended that the Mottley administration continue to engage in regular consultations with key interest groups on economic policies and their impact on the consumer.
He said communication was key since this provides an opportunity for the political administration to clarify the rationale and benefits of their decisions and actions to consumers.
But he reminded the Government that communication is a two-way street and that it needs to obtain adequate feedback and research information from consumers about ways in which belt-tightening can be modified or adjusted to ease consumer tension and restore further levels of confidence in the population.
Dr Devonish declared: “Consumer confidence or optimism is crucial to restoring economic growth and development in any country.
“We at the University of the West Indies, Cave Hill Campus will continue to provide high-quality and powerful research that serves to inform practice and policy in an effort to help Barbados improve and move forward.”