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Study shows nearly three out of four Malaysians think country in recession, financial prudence growing
PETALING JAYA, Nov 26 ― Nearly three quarters of Malaysians believe the country is currently in a recession, according to market research and analysis firm Nielsen.
Its Malaysian chapter said its findings in collaboration with the Conference Board Global Consumer Confidence Survey indicated the perception to have risen to 73 per cent compared to 70 per cent in the second quarter of this year.
“Among these, 34 per cent are optimistic about an economic recovery in the next 12 months,” Nielsen Malaysia said in a statement today.
It added that those upbeat about the economic recovery was higher in the second quarter, at 38 per cent.
The survey highlighted the top concerns for Malaysians now remained the same as at the beginning of the year, listing them as the state of the economy, job security, work-life balance, political stability and debt.
“While concerns on the economy and job security have fallen significantly since the beginning of the year, they continue to top the list of what matters most to Malaysians,” Nielsen Malaysia managing director Luca De Nard said.
He also said current confidence sentiments seem to have stabilised compared to a steady decline seen in the first half of 2019, after shooting to an all-time high in the last quarter of 2018.
“Since the all-time high index score in Q3 2018, we have seen a steady quarter-on-quarter decline in consumer confidence.
“However, the index score appears to have stabilised in Q3 2019. Slower Gross Domestic Product (GDP) growth and higher headline inflation compared to the previous quarter did little to dent Malaysians’ overall confidence regarding their future financial prospects,” he said.
De Nard noted that Malaysia retained its 10th placing globally on the Consumer Confidence Index (CCI).
The CCI is driven by three indicators of consumers perceptions on local job prospects, personal finances and readiness to spend.
Nielsen said the latest study showed that most Malaysians have a generally positive outlook for the next 12 months, especially in securing better jobs despite a slight dip in confidence in the state of their personal finances.
For now, 62 per cent believe their personal finances are excellent or good compared to 63 per cent in the second quarter of this year, and down from 75 per cent in the third quarter of last year.
Only 44 per cent say now is the time to buy things they want or need compared to 48 per cent just three months ago or 58 per cent in the third quarter last year.
The survey also showed that Malaysians are continuing their prudent spending habits to save on household expenditure due to longstanding concerns on the current economic state.
“Consumers said that they were saving money by spending less on discretionary items such as new clothes and out-of-home entertainment, as well as switching to cheaper grocery items,” De Nard said.
He said such frugality showed Malaysians to be more price sensitive spenders who had no qualms switching brands for better value.
He cited Nielsen’s recent Global Consumer Loyalty Survey showing 49 per cent of Malaysians consumers conceding they always switch to whichever brand offers the best value for money while 47 per cent will switch if there is a price reduction or promotion.
The studies also showed 60 per cent Malaysians are becoming more frugal in the third quarter by putting their spare cash into piggy banks, compared to 54 per cent who would do so in the second quarter of this year.
At the same time, 40 per cent said they spend on holidays compared to 28 per cent in the previous quarter, while 39 per cent paid off debts, credit cards and loans compared to 33 per cent earlier.