Ohio Debt Level Rises in May

DEBT LEVEL RISES IN MAY, ADDING TO STRESS OF OHIO CONSUMERS

COLUMBUS -- Ohioans added substantially to their credit card 
debt in May, according to the latest Ohio Consumer Debt Index.

The index, compiled by The Ohio State University's Survey 
Research Unit, stood at 88.4 in May, up four percentage points 
from its April value of 84.3.

The increase during May was due largely to a 30 percent rise 
in the percentage of consumers who were carrying an unpaid 
balance on their credit cards, said Lucia Dunn, professor of 
economics at Ohio State and one of the leaders of the survey.

"The continuing economic prosperity, along with the strong 
employment outlook, may be responsible for the rising demand for 
credit we observed in the May survey," Dunn said.

The potential downside of the increasing debt, however, was 
a rise in the debt stress that Ohioans experienced.  The Ohio
Debt Stress Index rose nearly a point, from 27.1 in April to 28.0 
in May.  The debt stress index is computed from questions that 
ask respondents how much they worry about their overall debt, how 
much stress the debt causes, and how concerned they are about 
paying off the debt.

"The debt stress index will need to be watched closely in 
the coming months, as it appears to be an early indicator of 
consumer confidence, which itself is an early indicator of the 
future health of the economy," said Paul Lavrakas, director of 
the Survey Research Unit.

During the first quarter of 1998, consumers worked to reduce 
charge balances built up during last year's holiday shopping 
season.  Debt rose again in April, which is traditionally a month 
of high charge activity because consumers conserve cash to pay 
taxes.  But, unlike last year, debt did not drop this May from 
its April level, Dunn said.

The Ohio Consumer Debt Index is computed from data collected 
in a statewide monthly household telephone survey.

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Contact:  Lucia Dunn, (614) 292-8071
          Paul Lavrakas, (614) 292-3468

Written by Jeff Grabmeier, (614) 292-8457