According to the survey, better than one-in-three respondents (34%) say they'll spend less over the next 90 days than they did a year ago. That's 9 percentage points worse than the previous survey in November. Just 29% say they'll spend more - down 3 points from previously, while 36% say their spending will remain the same.
The decline in spending growth was seen occurring across all income levels - even among respondents who earn more than $150,000 per year.
"While this is ChangeWave's fourth consecutive survey since June showing a consumer pullback, this is first time consumer spending growth has actually gone into the red," said Tobin Smith, founder of ChangeWave Research and editor of ChangeWave Investing, who added, "Frankly, the news doesn't look good on the spending front."
To put these findings in context, compare the latest January 2008 numbers (see downloadable chart) with the gradual contraction experienced more than a year earlier (see June through September 2006) in the period known as the "soft landing." Clearly, the current contraction looks quite different from a soft landing.
Reasons for Spending Less
The survey asked the 34% of respondents who say they'll be spending less to say why they planned to spend less. Better than one-in-three (36%) pointed to Inflation - which is 6-points more than the previous ChangeWave survey in November. Another 33% blamed Higher Energy Costs, 4 points higher than previously.
In a strong sign that consumers are worrying more about their nest eggs, 57% of those spending less say they're trying to improve their personal finances by reducing debt (32%) and saving more money (25%). These totals are also up 4 points since November.
Where is Spending Slowing?
Nearly every consumer category looked at in the survey scored lower than a year ago in terms of spending going forward. This decline was led by restaurant spending, which has deteriorated 12 points compared to year-ago levels.
Other consumer spending categories down in the current survey include Travel/Vacation (-7), Consumer Electronics (-7), Durable Goods (-4) & Household Repairs/Improvements (-2).
In other signs of weakness - better than half (56%) of respondents now think the overall direction of the economy is going to worsen over the next 90 days, a substantial 18-point jump since November. At the same time, only 9% believe the economy is going to improve, 7 points worse than previously.
