NEW YORK -- Consumer confidence declined sharply in December, largely because of the discouraging employment outlook, a private research group reported Tuesday.
The New York-based Conference Board said its Consumer Confidence Index dropped to 80.3 from a revised 84.9 in November. Analysts had been expecting a reading of 88.0.
Lynn Franco, director of the Conference Board's consumer research center, said "the major factor dampening consumers' spirits has been the rising unemployment rate and the discouraging job outlook."
"Weak retail sales over the holidays clearly reflect the current mood of consumers," Franco said. "Until there is an improvement in labor market conditions, there is not likely to be a significant upturn in consumer confidence."
The Conference Board's index, based on a monthly survey of 5,000 U.S. households, is closely watched because consumer confidence drives consumer spending, which accounts for about two-thirds of the nation's economic activity.
The index compares results to its base year, 1985, when it stood at 100.
The Conference Board report showed waning consumers' confidence about current economic conditions.
The number of consumers rating current conditions as "good" fell to 14.6 percent, down from 16.1 percent in November, while the number sizing up the conditions as "bad" remained steady at 26.0 percent, the Conference Board said.
Consumers had more optimistic expectations for the next six months, the board said.
The number expecting an improvement in business conditions in coming months grew to 20.8 percent from 20.3 percent a month earlier. Respondents who held the opposite view declined to 11.0 percent, down from 11.3 percent in November.
The outlook for jobs was grim, with 20.2 percent of consumers saying they expect fewer jobs to open up in the next six months, up from 18.8 percent in November. Those expecting more jobs fell to 15.1 percent from 15.4 percent.
Income expectations were dour, too, with 18.7 percent of consumers anticipating a rise in their incomes, down from 19.4 percent a month ago.
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