Six-in-ten American families with children at home (62 percent) say they plan to spend less this year than last or nothing at all on back-to-school shopping, according to the RBC Consumer Outlook Index. Although most families are cutting back, nine percent say they actually plan to spend more and 29 percent say they will spend about the same this year as last year on back-to-school items.

Despite a planned reduction in back-to-school spending, a barometer of consumer sentiment, consumer confidence as measured by the RBC Consumer Outlook Index rebounded this month, increasing to 63.9, compared to 47.2 in July. The improvement in the Index is driven primarily by less negative sentiment about job security and future economic prospects, rather than any sudden optimism.

"The pull-back in back-to-school shopping is a true sign of the times," said Tom Porcelli, U.S. Market economist at RBC Capital Markets. "The economic recovery has been slow and uneven leading to diminished expectations for many Americans. As they adjust to living in this new economic reality, consumers continue to remain very cautious when it comes to personal spending."

While this month's index shows consumers' interest in investing in real estate is edging up, they are not at all sure about the fate of the housing market. Asked how they expect the prices of homes for sale in their neighborhood will change in the next year, 32 percent said they would increase, 37 percent said they would stay the same and 31 percent said they would decrease.

Despite ongoing job losses, relative confidence in personal job security showed signs of improvement this month. Forty-three percent of consumers say it is unlikely that someone they know will lose their job in the next six months, significantly better than the 35 percent saying that in July. However, the number of consumers actually experiencing job loss in their immediate circle was 53 percent this month, basically unchanged from July's 52 percent.

Although the recession continues to have lingering effects, consumers' assessments of the future of the economy were less pessimistic this month. More than half of Americans (54 percent) say the economy in their local area remains very weak, yet only 23 percent of consumers expect their local economy to weaken in the next six months, down from 28 percent last month. More broadly, 40 percent of Americans say the national economy will get worse in the next six months, compared to 44 percent in July.

The survey also found that consumers continue to be concerned about the soundness of the market and are increasingly wary about investing. This month, 40 percent of consumers say that this is a bad time to invest in the stock market, compared to 34 percent in July. However, the share who say it is a good time to invest in the market remained unchanged from last month at 16 percent.

Consumers are, however, feeling better about where interest rates are headed this month. Only 36 percent say that interest rates will go up in the next six months, compared to 41 percent in July. Americans are also feeling better about purchasing real estate, with 35 percent saying it is a good time to buy property, up from 31 percent last month.

"Consumers are feeling tapped out and are not at all convinced that their financial and employment situations are stable," said Porcelli. "What appears to be more likely is that fears and concerns are subsiding and more consumers are saying 'things are about the same'. Unfortunately for us all, 'the same' reflects a fairly poor economic climate."