• by Jack Loechner , Staff Writer @mp_research, May 1, 2006

Retail Forward's Future Spending Index foresees stronger consumer spending in the month ahead. The index increased in April for the second month in a row, as the month-to-month increase indicates better growth than last year as well.

Steve Spiwak, an economist with Retail Forward, said "Despite fears of an impending slowdown, shoppers are telling us they plan to boost their spending in the near term primarily because they feel better about job prospects. What's encouraging is that the optimism is broad-based,... with all (shopper segments) expressing heightened optimism."

In April, the Future Spending Index increased for each of the key income segments compared with the prior month.

· The index for households with incomes between $22,500 and $75,000 registered 104.4 in April, up from 98.8 in March.

· The index for households earning less than $22,500 annually climbed 116.2 compared with 110.0 a month ago.

· The index for households with incomes greater than $75,000 is up six points from March. The recent stock market run-up and a brighter employment outlook are boosting the spending moods of more affluent households.

Comparisons between 2005 and 2006 spending plans reveal that shoppers are more likely this year to focus on updating their closets rather than their backyards. Additionally, shoppers' spending plans indicate more polarization in spending plans than previously.

Most shoppers still wear somewhat casual or very casual clothes to work, though some segments are becoming more casual than others.

· Half of all female Down Market (HH income < 22,500) shoppers wear very casual clothes to work (an eight percentage point increase compared to 2005) while 56% of male Down Market shoppers favor the same casual attire (a twelve percentage point increase compared to 2005)

· 46% of Male Middle Market (22.5-74.9) shoppers saw the largest increase in the percentage wearing somewhat casual clothes to work, up from 34% last year.

44% of female Up Market (over $75M) shoppers favor clothes such as slacks or skirts without a jacket/blazer, compared to 39% in 2005, while 32% of all male Up Market shoppers wear very casual clothes on a typical workday, up from 23% in 2005.

The complete release may be found here.