This Week's Economic Roundup
While higher gas prices have most consumers worried about the economy, small-business owners are keeping a positive outlook on prospects in their own markets. Here's a look at this week's economic developments and how they may affect your business.
Small-Business Outlook Mixed
The nation's small-business owners are feeling increasingly uneasy about the direction of the overall economy, the National Small Business Association reported on Tuesday.
Out of 500 small and midsize companies surveyed nationwide, 43 percent said they felt the economy was in worse shape than five year ago, the Washington-based policy group said.
Despite the bleaker outlook on the economy in general, 81 percent of respondents said they remained confident about prospects in their own market sectors, with a majority expecting gains in revenue and profits in the next 12 months, the report said. Just over half said they anticipated the gains to come from advertising and marketing strategies, while 28 percent were planning to increase employment.
Consumer Confidence Down
Following declines last month, consumer confidence continued to fall in April, driven down by rising gas prices, the Conference Board reported on Tuesday.
Based on a survey of 5,000 households nationwide, the private research group's consumer confidence index dropped 4.2 points to 104, compared to its 1985 benchmark level of 100.
"Unlike the declines in March, which was solely the result of apprehension about the short-term outlook, this month's decline was a combination of weakening expectations and a less favorable assessment of present-day conditions," Lynn France, the group's consumer research director, said in a statement.
Existing-Home Sales Plummet
While sales of existing homes fell by 8.4 percent in March, the largest decline in 18 years, new home sales edged up by 2.6 percent, according to a pair of reports this week.
The sharp declines in existing home sales followed three months of gains and were blamed on bad weather and troubles in the subprime mortgage market, the National Association of Realtors reported on Tuesday.
In total, there were 3.75 million existing homes left on the market in March, representing a 7.3-month supply at the current sales rate. Sales were down by 11.3 percent below the same period last year, while median prices have dropped by 0.3 percent to $217,000.
Meanwhile, sales of new single-family homes rose by 2.6 percent in March to an annual rate of 858,000, the Commerce Department reported on Wednesday.
Despite the gains, sales of new homes were 23.5 percent below the same period last year, the report said.
Median prices were steady at $254,000 with about 545,000 homes left on the market at the end of the month, representing a 7.8 month supply at the current the sales rate.
Gas Prices Dip
Following 11 weeks of gains, average gas prices across the nation dipped by 0.7 cents to 286.9 cents per gallon this week, the Energy Information Administration reported Wednesday.
Though high, gas prices were 4.5 cents below the same period last year, the agency said.
This week's declines were led by the Midwest, where prices dropped 3.2 cents to 277.5 cents per gallon. By contrast, prices on the Rocky Mountain region rose by 4.3 cents to 284.4 cents, the agency said.
Jobless Claims Down
The number of new claims for unemployment benefits dropped by 20,000 to 321,000 over the week ending April 21, the Labor Department reported on Thursday.
Nearly 2.6 million people filed jobless claims the previous week, inching the national insured unemployment rate up by 0.1 percent to 2 percent, the report said.
The biggest declines last week were in California, Pennsylvania, and Illinois, while the biggest increases were in New York, New Jersey, and Puerto Rico.