Personal finance and job prospects boost consumer confidence in Dubai
Cut in outdoor expenses and energy consumption, top priorities
Overall consumer confidence in Dubai remained robust during the first quarter of 2012, driven largely by a positive outlook on personal finance and strong optimism on job prospects, according to the quarterly consumer confidence index (CCI) published by the Department of Economic Development.
Indicating that Dubai and its economy continues to invoke positive sentiment and trust among investors, CCI remained at a higher than average level of 124 percentage points during the first three months of the year.
The CCI is the result of quarterly consumer confidence surveys based on three questions regarding perceptions on local job prospects, personal finances and suitability of making purchases, all over the next 12 months. The initiative aims to evaluate consumer impressions on the state of the economy and the key drivers of consumer behaviour.
The Index showed that personal finance looks strong:
* 79 per cent consumers have a positive outlook currently and for the next 12 months
* 66 per cent feel this is a good time to buy things they want and need
Improvement in current job prospects is also anticipated:
* 66 per cent optimistic that the job situation will improve in next 12 months
Those working in private sector are more positive in their outlook:
* 66 per cent optimistic about the current job
*77 per cent about personal finance
Among government employees:
* 68 per cent are optimistic about their current job
* 89 per cent about personal finance.
Perceptions on the state of economy also showed a clear improvement during Q1 of 2012:
* 67 per cent expressed positive outlook for the coming 12 months.
However, the state of economy continues to be the biggest concern among consumers, with political stability in the Arab World and job security being the other major concerns in that order.
Saving appeared to have moved up on priority charts:
* Number of consumers who save their money rose by 15 per cent in the first quarter of 2012 to reach 50 per cent compared to the fourth quarter of 2011.
*37 per cent tend to spend their cash reserves on new clothes and outdoor entertainment
* 33 per cent on new products and technology
* 21 per cent on home decorations and renovations
These choices indicate the type of purchase and spending of the public as well as the kind of leisure and luxury they prefer.
People are also looking at ways to reduce expenses.
* 60 per cent looking for ways to reduce expenses of outdoor entertainment as early as possible
* 41 per cent seek to trim such expenses over the next 12 months
* 58 per cent have started rationalising energy consumption
* 39 per cent plan to do so over the next 12 months.
The CCI looks at 15 means of reducing the cost of living and rationalising expenditure for consumers, the most preferred means include cutting down on the expenses for outdoor entertainment, phone and energy bills (gas, electricity), annual vacations, as well as searching for better deals on home loans, insurance and credit cards.
DED is keen to provide realistic information on the economic, trade and retail trends in Dubai based on extensive field studies conducted among all groups of people as well as businesses and organisations in the public and private sectors. The CCI is based on true perceptions on the current employment opportunities, personal and financial conditions, and the consumer’s assessment of whether the time is suitable to make major purchases currently and over the next 12 months,” said Sami Al Qamzi, Director-General of DED.
Omar Bushahab, CEO of the Commercial Compliance and Consumer Protection Division, DED, added: “Studying the behaviour of consumers is essential to know the trends and patterns in buying, spending and saving; all of these provides a viable means to know the level of growth in the local market. Consumer confidence is evident from their spending without compromising on the financial stability or goals they have set for the longer term.”
The Commercial Compliance and Consumer Protection Division of DED developed and conducted the quarterly consumer confidence surveys in co-operation with a global market research firm to ensure best practices and utmost efficiency in providing critical insights to governments and organisations on consumer perceptions and trends influencing economic activity.