When It Comes to Economic Angst, It Really Is a Small World After All

Global Survey Finds General Lack of Confidence in Recovery, Reluctance to Spend and Job Worries; Mexico and Brazil Offer Some Bright Spots

By Published on .

Credit: Note: The bottom income quartile was excluded and sample reweighted to represent real income distribution in each country. Source: BCG Consumer Sentiment Barometer, Spring 2011.

There's just no escaping sluggish economic trends -- not in the U.S., U.K., Japan and Italy, and maybe not even in developing markets such as China and India. A consumer survey by Boston Consulting Group concludes that anxiety is on the rise everywhere.

"The slight uptick in confidence over the past two years has leveled off and in some cases retreated, as a string of global crises -- the massive earthquake and tsunami in Japan and unfolding unrest in the Middle East -- drown out news of modest economic progress," the report says.

With the survey as our guide, let's go around the world in eight bullet points:

U.S.: Caution reigns, with 57% of respondents saying they "feel personally affected by the downturn," up from 49% last year. Consumers are buying fewer goods and gravitating to private label. And for marketers looking to pry dollars loose, this might be the worst part: While the economy is a factor, more consumers are simply "enjoying the feeling of saving money."

U.K.: Things aren't much cheerier in the U.K., where the report says confidence has "eroded since the pre-election highs of last year's survey." In other words, Prime Minister David Cameron, you've got some work to do. Half of the survey respondents expect the recovery to take several years, up from 31% last year.

JAPAN: Already hurting economically, Japan was sent into a tailspin by the tsunami. Some 40% of consumers will cut their discretionary spending, the survey found. And "as a result of high anxiety and stress, many Japanese consumers are 'cocooning' -- favoring activities that can be enjoyed at home."

MEXICO: There's some bright spots south of the border, with GDP estimates revised upward and unemployment dropping some. Yet, Mexicans are still anxious about the future, in part because of "negative impressions about the government's war on drugs" and uncertainty about the 2012 presidential election.

ITALY: Italians are among the most pessimistic of those surveyed, with an astounding 70% feeling anxious about the future, up from 45% in 2010. Consumers are "extolling the virtues of a more 'conscientious' approach to consumption -- claiming that they plan to buy fewer things and cut back on nonessentials," the report said.

CHINA: GDP growth is sailing along at nearly 10%, leading Boston Consulting Group to project retail sales to jump 50% by 2015. But while the percentage of respondents feeling anxious about the future was 30% -- one of the lowest rates in the survey -- it ticked up slightly from last year. And consumers still aren't in a mood to "spend carelessly -- they still seek value and trade down actively," the report said.

INDIA: GDP growth is good, but there are signs of trouble. Inflationary pressures are mounting and "job insecurity is growing," the report said.

BRAZIL: Not much to complain about here, with retail sales expected to leap 40% by 2015. Brazilians are trading up and "were the ones most likely to identify 'I deserve it' as a rationale," suggesting "they have financial flexibility."

In this article:
Most Popular