Nevill Boyd-Maunsell: We're a long way off panic in the streets
People who reply to surveys seem, sometimes to know something that the rest of us don’t know.
Take Nationwide’s respected consumer confidence index. That is the one that revealed how a shrewd minority of 14 per cent last summer saying this was a good time to buy a house or a car, turned into a chunky 40 per cent or so, this summer.
Bargains are bargains, even if you yourself cannot raise the ready to snap them up. The idea got around.
Yet answers to a question about whether your household income will be higher, lower, or the same in six months’ time are less easy to fathom.
Add those who expect no change to those looking for an increase and you get an overwhelming and consistent majority who think they are going to be all right.
The economy may be heading to hell in a handcart. British shoppers and home-buyers are bent double with debt, the British Government, too. Nobody, in the private sector anyway, can call their job safe. But it won’t happen to me. That consensus has held steady at 84 per cent from April to June. It fell no further than 80 per cent during the total gloom of last December and January.
True, this combined total of optimists stood at an extraordinary 91 per cent in May last year. That was when the Bank of England was worrying about petrol and electricity prices feeding into pay inflation – which 26 per cent of Nationwide’s respondents though might be coming their way.
When you consider all the households where one of the breadwinners is going to retire in the next six months or stop work for health reasons, or to look after children, that steady 84 per cent represents a wall of personal well-being.
Nor does it match the combined number thinking the economy will be the same as today, or better, six months out. That climbed steadily from a nadir of 46 per cent in January to 75 per cent in June. Yet it still leaves a nine-point gap – all people who expect to do better than the economy. Back in the misery of January it was a 34-point gap.
It is rash to draw conclusions from a single survey, however consistent. But this one does fit with the failure of retail sales to collapse. It has to be a factor stopping the recession getting worse. It points, too, to a well of potential resistance to pay cuts at BA or elsewhere, or time-off for money-off deals like that proposed by the CBI.
And the Conservative can forget any thoughts of riding to victory on a wave of personal financial despair. We are a long way from panic on the streets.