A University of Florida study found that Florida’s consumer confidence is down this month — people are less inclined to spend money.
November confidence rates in have dropped four points to 76, according to the UF Bureau of Economic and Business Research.
Chris McCarty, the bureau’s director, is not surprised by this drop.
He said he thinks consumer confidence rates have been inflated over the last few months because of the election. Political affiliation also determines rates.
“The Democrats are more confident in November than October,” McCarty said. “The Republicans are less confidant.”
With elections over, the media has turned to the impending “fiscal cliff,” a combination of tax increases and spending cuts due to automatically occur on Jan. 1 if no debt reduction agreement is reached.
Consumer confidence is partly based on people’s current personal finances and their expectations for their future financial situations, McCarty said. People benefiting from the Bush tax cuts, which are likely to expire, might not be confident about their financial futures.
U.S. economic conditions throughout the next year and the next five years also factor into consumer confidence rates, he said.
Consumers may also be concerned that Congress won’t make sufficient adjustments to the Alternative Minimum Tax (AMT), McCarty said. The 1982 tax is affecting more and more people as inflation increases, and could potentially raise tax rates for 30 million Americans.
While consumer confidence for Floridians was lower overall, it remains the same for big-ticket items like refrigerators and washing machines.
Katherine Hahn edited this story online.