(1)

Credit Crunch Tracking

June 2011

Cautious Optimism Resurfaces …

(2)

Cautious Optimism Resurfaces…

In spite of the current debt crisis in Greece/Europe, Irish consumers remain as optimistic as post-election three months ago, and much more optimistic than a year ago.

Expectations for the Irish economy have also improved, and as a people we claim to be much “happier” than three months ago.

Our monthly spending has increased also slightly…

… however concerns over the World economy are stifling further increases.

(3)

Our personal outlook on the recession is much more positive than a year ago and unchanged from the level recorded post-election.

(4)

393530

33High impact (8-10)

Limited Impact (1-3)

Personal Recession Impact – Overall

Average 6.7

Some Impact (4-7) 52

6.2

March‘11%

52

159

May‘10%

6.2

June‘11%

47

18

Less people feel personally impacted by the recession than a year ago.

But more than 1 in 3 still feel the recession has had a major impact on them personally.

5.9

49

21

Sept‘10%

(5)

39 39 3942

48

37

26

36

4145

36

3027

33 3230

33

19

24

34 34

27

32 3133

30

41

35

18

27

39 40

27

3533

3634 33

43

20

32

38 3734

18-34%

35-44%

45-64%

AGE

65+%

Any%

None%

CHILDREN

Male%

Female%

GENDER

ABC1%

C2DE%

SOCIALCLASS

Personal Recession Impact Overall– Net High Impact (8-10)

TOTAL%

The 45-64 year olds feel more impacted overall by the recession than any other demographic group and are considerably more impacted now than in March.

June‘11

May‘10

March‘11

Sept‘10

(6)

The impact on our monthly spending and way of life has lessoned over the past year, with a decreased impact on job security in the past three months.

(7)

41 32 37 35 3323 29 29

Monthly Spending

Average

Your Way Of Life

High impact (8-10)

Limited Impact (1-3)

Some Impact (4-7)

Impact of Recession on….

5.7

48

March‘11%

6.2

46

March‘11%

-2% 0%

+1% +1%17

23

6.1

50

May‘10%

17

6.5

44

May‘10%

15

+1% -1%

6.1

47

June‘11%

18

5.7

47

June‘11%

24

5.8

47

Sept‘10%

21

5.5

52

Sept‘10%

25

(8)

Full-time Workers Part-time Workers

Impact of Recession on Job Security

30 22 21

4536 35 37

21

Average

High impact (8-10)

Limited Impact (1-3)

Some Impact (4-7)

5.9

40

March‘11%

4.9

39

March‘11%

-1%+2%

-4% -4%

2539

5.2

33

May‘10%

37

6.5

34

May‘10%

21

+5%+2%

35

June‘11%

44

36

June‘11%

27

4.5 5.94.4

33

Sept‘10%

46

5.7

34

Sept‘10%

30

(9)

Expectations for the Irish economy continue to improve – after falling back at the end of last year with the austerity budget

(10)

38 39 3235 29 29 30 31

40 4129 17 21 30 23 19

9 718

21 2317 19 21

1 1

21 2

2 2 2

Much better (5)

Much worse (1)

Average

Stay the same (3)Slightly better (4)

Slightly worse (2)

1.92

12

1.88

11

2.32

18

NET Same/Better (3-5) 22 19 38

How do you expect the Irish economy to fare in the next 6 months?

May‘09%

July‘09%

Oct‘09%

2.54

26

48

Feb‘10%

2.57

51

May‘10%

26

Almost 1 in 4 expect the economy to improve over the next 6 months.

Half do not expect the economy to worsen over the next 6 months.

2.32

41

Sept‘10%

22

2.47

47

March‘11%

25

2.56

50

June‘11%

27

(11)

The youth has the most positive expectations for the economy.

While we see a significant decline in expectations among the elderly.

(12)

Expectations for the Irish economy 6 months from now % Stating they believe it will be the same or better (3-5)

50 5248

55

43

50 49 49 49 4850

18-34%

35-44%

45-64%

AGE

65+%

Any%

None%

CHILDREN

Male%

Female%

GENDER

ABC1%

C2DE%

SOCIALCLASS

TOTAL%

Change since

Mar ‘10+3% +3% +4% +6% +4% +7% -10% +1% +2% +4% +2%

(13)

In contrast, expectations for the World economy continue to decline – perhaps driven by the debt crisis in Greece

(14)

33 3421 17 21 21 24 26

15 11

85

8 8 1013

31 3144

53 43 41 37 33

3 2

5

56 5

53

Much better (5)

Much worse (1)

Average

Stay the same (3)

Slightly better (4)

Slightly worse (2)

NET Same/Better (3-5)

2.72

16

2.77

18

3.18

19

50 51 68

How do you expect the World economy to fare in the next 6 months?

May‘09%

July‘09%

Oct‘09%

3.36

20

78

Feb‘10%

3.17

22

71

May‘10%

Almost 2 in 5 expect the World economy to fare worse in the next 6 months.

But more than 1 in 3 expect the World economy to improve in the next 6 months.

3.13

25

71

Sept‘10%

3.04

23

66

March‘11%

2.88

25

61

June‘11%

(15)

Expectations for the housing market and job security in Ireland are unchanged over the past three months.

(16)

44 40 3735 32 37 35 37

37 38 3639 36 34 32 32

21 22 19 13 13 14 18 17 42 4028 21 21 21 23 24

15 15 10 12

7 712 12 14 13 12 13

2 21

12 1 2 2 1 3

11 12 1515

1

22 2

22

Much better (5)

Much worse (1)

Average

The Housing Market 6 months from now?

Job security 6 months from now?

2.29

Stay the same (3)

Slightly better (4)

Slightly worse (2)

1.85

20 11

2.32 1.89

23 14

2.43

26

2.24

20

NET Same/Better (3-5) 33 1937 2243 34

2.59

36

53

2.34

27

40

May‘09%

July‘09%

Oct‘09%

Feb‘10%

May‘09%

July‘09%

Oct‘09%

Feb‘10%

How do you expect the Housing and Job markets to fare in the next 6 months?

2.60

55

May‘10%

2.39

42

May‘10%

38 27

2.55

49

Sept‘10%

32

2.40

45

Sept‘10%

31

2.40

47

Mar‘11%

36

2.37

45

Mar‘11%

32

2.43

46

June‘11%

32

2.38

44

June‘11%

28

(17)

There is an increase in happiness among Irish consumers since March, with less people suggesting their quality of life, motivation and energy has declined

(18)

35 26 22 15 24 16 26 20

1920

2026 25

1313 16

Better

Worse

The Same

Change Compared To Same Time Last Year in ....

Quality of Life

%

Your Happiness

%

Your Energy for Life

%

Your Motivation

%

74%85% 84% 80%

Our happiness has improved with almost 1 in 5 feeling happier now that at the same time last year. Our quality of life has also improved but 1 in 4 feel that their

quality of life have declined since last year.

June‘11

61 66 64 55

March‘11

52 62 56 48

(19)

% Better/Same as same time last year

Quality of LifeYour

HappinessYour Energy

for LifeYour

Motivation

Total 74 85 84 80

Gender

Male 76 87 90 85

Female 72 83 78 75

Age

18-34 77 85 84 81

35-44 69 83 78 74

45-64 69 84 85 80

65+ 85 94 88 85

Social Class

ABC1 73 84 80 77

C2DE 72 85 84 80

Those aged 65 and over have seen a greater positive impact on quality of life and happiness compared to a year ago.

Change Compared To Same Time Last Year Analysed by key demographics

(20)

As a result more people claim to have either already increased monthly expenditure or expect to do so in the next six months…

…but uncertainty is holding further spending back.

(21)

7365

73 70 70 67 68 6774 68 74 72 72 66

74 71

11 12 9 7 10 9 8 7 13 12 12 10 15 17 11 12

1217

13 15 12 17 16 17 9 15 10 1210

1311 11

46

5 8 67 8 9

45

4 6 34

4 6Already increased

Not likely to increase

Entertainment such as going out, eating, drinking or

socialisingGrocery spend

Consumer goods and services – e.g.

hairdresser, clothes, mobile

phone, gaming etc.

Holidays and short

breaks

Likely to increasein next 6 months

Likely to increasein next 12 months

Likelihood to increase spend in...

More people are now claiming to have increased spend across all categories, but especially for entertainment/socialising – with an improved proportion also

saying they will spend more in the next six months

May‘10%

May‘10%

May‘10%

May‘10%

Sept‘10%

Sept‘10%

Sept‘10%

Sept‘10%

Mar‘11%

Mar‘11%

Mar‘11%

Mar‘11%

June‘11%

June‘11%

June‘11%

June‘11%

(22)

% Likely to increase spend in next 12 months

EntertainmentGrocery Spend

Consumer Goods/

Services

Holidays/ Shorter Breaks

Total 22 24 22 23

Gender

Male 21 21 21 24

Female 23 28 23 23

Age

18-34 32 36 29 32

35-44 20 22 18 20

45-64 16 19 18 17

65+ 15 18 20 21

Social Class

ABC1 22 26 21 20

C2DE 22 25 23 26

The 18-34 year olds are most likely to increase spend again... across all categories

(23)

Summary...

• Expectation for how the Irish economy will fare over the next 6 months shows signs of improvement again, after being heavily impacted by the last budget.

• The impact that the recession is having on people personally also appears to be improving.

• Optimism also remains regarding our personal situation, with less people expecting to be impacted by the recession personally and more people feeling happier than the same time last year.

(24)

Summary...

• Most positively this has led to more people claiming to already be spending more and those likely to increase spending in the future – particularly on entertainment and grocery.

• However, this potential increased spending is most likely to be seen particularly seen among those in younger age groups – and it is those in older age groups who have savings set aside that still need to be persuaded.

• The reticence to spend is being underpinned by uncertainty with the World economy, where concerns continue to grow, fostered by events in Greece.

(25)

Methodology – RED Express

• 1,000 telephone interviews (CATI) using a random digital sample to ensure coverage of all households, including ex-directory.

• Quotas were set and data weighted to ensure a national representative sample of the population aged 18+ years.

• This is the 11th wave of the credit crunch tracking – fieldwork was conducted the 20th-22nd June 2011.