Consumer confidence slumps in September

NEW YORK (CNNMoney.com) -- When it comes to attitudes about the economy, Americans continue to see the glass as half empty, according to the latest reading on consumer morale.

The Consumer Confidence Index fell to 48.5 in September -- its lowest level in 7 months -- and down from August's negatively revised level of 53.2, the Conference Board, a New York-based research group that compiles the index, said Tuesday.

The index has been volatile this year, not trending in any one direction for more than three months in a row. High unemployment and unfavorable business conditions have dragged the index down to a painfully low level, far below 90 -- the level which indicates a stable economy.

"Overall, consumers' confidence in the state of the economy remains quite grim. And, with so few expecting conditions to improve in the near term, the pace of economic growth is not likely to pick up in the coming months" Lynn Franco, director of The Conference Board Consumer Research Center said in a release.

Economists surveyed by Briefing.com had expected a much smaller decline, with the index touching 53.

In September, the number of consumers calling business conditions "bad" outweighed those saying conditions are "good" by nearly 6 to 1. Similarly, those saying jobs are "hard to get" far outnumbered those saying jobs are "plentiful." And the number of consumers with gloomy attitudes about both future employment prospects and business conditions, also increased.

"We're going to have to see some strong and steady job gains to convince consumers that the recovery is underway right now," Franco said. "While the recession may be over, it's still not feeling that way to consumers."

The consumer confidence index is based on a survey of 5,000 U.S. households and is closely monitored because consumer spending drives two-thirds of the nation's economic activity.

A reading of 100 or greater would indicate strong growth, and the index has not reached that level since mid 2007.