Consumer Confidence in Economy Low in November Ahead of Holidays: Shoppers Less Optimistic About Job Market

Despite economist predictions, a new report reveals that consumer confidence in the economy has actually dropped to its lowest level since June.

According to the Conference Board, an index of consumers' perceptions of the economy and labor market declined to 88.7 in November, compared to 94.1 in October, CNBC reports. Although economists expected a strong reading of 96 due to lower oil prices, the November 88.7 figure dropped to a level not seens since June's reading, which registered at 86.4.

A private sector report released on Tuesday stated that U.S. consumer confidence fell in November as optimism decreased in business conditions and jobs.

"Consumer confidence retreated in November, primarily due to reduced optimism in the short-term outlook. Consumers were somewhat less positive about current business conditions and the present state of the job market; moreover, their optimism in the short-term outlook in both areas has waned," Lynn Franco, director of economic indicators at The Conference Board, said in a statement. "However, income expectations were virtually unchanged and gas prices remain low, which should help boost holiday sales."

In the meantime, consumers' assessment of the labor market also became worse. The "jobs hard to get" index rose to 29.2 percent from 29 percent the month prior, while the "jobs plentiful" index dipped to 16 percent from 16.5 percent.

Experts say that the drop in sentiment even amid falling gasoline prices and improved labor markets can be a warning about a dip in consumer spending during the holiday shopping season.

However, Franco played down the risks.

"Income expectations were virtually unchanged and gas prices remain low, which should help boost holiday sales," she said, the Wall Street Journal reports.

Despite the drop, the latest reading is still higher than the confidence measure average of 69.8 in 2012 and 2013.

Also, "income expectations were virtually unchanged and gas prices remain low, which should help boost holiday sales," said Franco, according to USA Today.