California’s consumer confidence hits new peak
A statewide consumer confidence index confirms what crowded shopping centers, filled attractions and jammed freeways suggest: California’s shopper psyche is at a 28-month high.
The Conference Board’s polling put its consumer confidence index at 127.9 for June — up from a revised 118.2 a month earlier and up from 77.5 in the lockeddown economy of a year ago. The 8% one-month gain and a 65% gain over 12 months can be tied to reopening the state’s economy after widespread vaccinations lowered coronavirus health risks.
The last time this benchmark was higher was well before the pandemic in March 2019. California confidence averaged 113 in the five years before coronavirus chilled the economy.
California consumers’ view of current conditions scored 144.7 — up from 124.4 a month earlier and above 44.8 a year earlier. This measure averaged 141 in 2015-19.
Shoppers outlook statewide scored 116.7, more optimistic than 114.1 the previous month and up from 99.3 a year earlier. This measure averaged 94 in 2015-19.
Jobless claims dip again
California workers filed 57,000 jobless claims during the week ending June 26, down 6,900 from the previous week, the U.S. Labor Department reported Thursday.
Nationwide, seasonally adjusted jobless claims fell 51,000 in a week to 364,000 last week.
Applications for unemployment benefits have fallen more or less steadily since the year began. The rollout of vaccines has sharply reduced new COVID-19 cases, giving consumers the confidence to shop, travel, eat out and attend public events as the economy recovers.
The drop in jobless claims was steeper than economists had expected. Applications for unemployment benefits have now fallen in 10 of the past 12 weeks.
“As life normalizes and the service sector continues to gain momentum, we expect initial jobless claims to remain in a downtrend,” said Joshua Shapiro, chief U.S. economist at the consulting firm Maria Fiorini Ramirez.
The job market’s improvement comes against the backdrop of a fast-rebounding economy. Growth for the just-ended AprilJune quarter is believed to have reached an annual pace of roughly 10%.
State’s challenge to WFH taxes rebuffed
The U.S. Supreme Court rejected a New Hampshire challenge to Massachusetts’ practice of taxing people who once worked in that state but started telecommuting from elsewhere during the pandemic.
Turning away a case that could have put billions of dollars at stake, the justices, without explanation, denied New Hampshire permission to sue Massachusetts directly at the high court.
Had it gone forward, the case could have determined the fate of similar, permanent tax laws in New York, Pennsylvania and three other states. New Jersey and Connecticut urged the court to accept the New Hampshire lawsuit, saying they are losing massive sums to neighboring states, primarily New York, in violation of the Constitution.
The stakes were especially high for New Jersey, which told the court last year it expects to credit as much as $1.2 billion to its residents for income taxes paid to New York in the 12 months starting in March 2020. Before the pandemic, more than 400,000 residents of New Jersey commuted to jobs in New York City.
Arkansas, Delaware, Nebraska and Pennsylvania also tax nonresidents for work they do from home for in-state employers.
Connecticut taxes nonresidents who work from home but only if their states do so as well.