ATLANTA (2/25/11)--Georgia consumers are not optimistic about the state's economic condition, according to a poll from Georgia Credit Union Affiliates (GCUA). Just 12% of consumers surveyed said they believe the economy has improved in the past year and 40% said the economy was getting worse. The remainder characterized the state's economic situation as either "the same" or "getting worse" than last year--sentiments that could impact consumer saving and spending in the state, said GCUA in its quarterly Georgia Credit Unions' "Paying Attention" report. The report polled more than 4,000 credit union members and compiled aggregated data from credit unions statewide. While consumers are working to build a buffer of savings by cutting expenses and delaying large purchases, they still are unprepared to deal with any further financial setbacks, the report indicated. "As national statistics start to show an increase in consumer confidence, Georgia credit union members are still wary about their own personal financial health," said Mike Mercer, president/CEO of GCUA. "If the economy strengthens, consumers could become more optimistic. But, in the meantime, we expect to see cautious plans for spending and especially borrowing. In fact, loan demand at Georgia credit unions has been very soft," he said. Other key findings of the survey:
* Of those polled, 32.9% said they experienced changes in their employment situation during the recession, ranging from layoffs to pay cuts to taking a second job. * About 35.7% said they have no reserve savings to cover essential expenses if they were to lose their job or other income source. Also, 18.9% said they have savings to cover more than one year without a source of income. * About 65.5% have changed their personal savings habits the past six months, including spending less or cutting expenses like eating out and taking trips. * Consumers surveyed were more wary than in 2010 about making large purchases; 63.3% indicated they do not plan to purchase any big-ticket items in 2011. That compares with 51.2% who avoided big expenditures last year. * Half said they will pay for large purchases with cash from savings.
GCUA also compiled data from 39 credit unions representing 91% of credit union assets and 83% of members in Georgia. Data reflect a trend toward savings, with lending figures varying. Savings deposits at credit unions rose at an annualized rate of 5.42% during 2010, slightly less than the 6.24% increase in 2009. Checking account balances grew by 13.12% in 2010. New-vehicle loans continued to decline with more consumers opting for used-car loans. New-vehicle loan balances fell 10.42%, while used-car balances rose 7.16%, continuing a trend from 2009. First mortgage balances increased by 9.89%, and the number of bankruptcy filings among members rose 12.47% in 2010.