- Economic Confidence Index fell from -39 to -45
- Confidence falls due to poor ratings on current conditions
- Inflation sees government as the most important problem facing the U.S.
WASHINGTON, DC – Gallup’s economic confidence index came in at -45 in May, down from -39 in the previous two months. This is Gallup’s lowest reading in trends during the coronavirus pandemic and likely the lowest confidence since the end of the Great Depression in early 2009.
Gallup’s Economic Confidence Index is a summary measure of Americans’ perceptions of the current state of the economy and its economic outlook. It has a theoretical range of +100 (if all respondents say the economy is good or good and getting better) to -100 (if all say the economy is bad and getting worse).
The latest results are based on a May 2-22 Gallup poll, which came amid record natural gas prices, rising inflation, the government’s report of slowing economic growth in the first quarter and a slump in the stock market. Low unemployment is a rare bright spot, but employers are still struggling to find workers to fill needed jobs, leading to ongoing supply chain problems.
Gallup has measured Americans’ views of the economy in its multi-day telephone survey since 1992, but rarely did between 2009 and 2017. At some point in those years, confidence might have been lower than it is now.
Confidence is significantly lower than it is now in February 2009, when the index recorded -64 in that month’s Gallup poll.
Americans are less optimistic about current conditions
Currently, 14 percent of U.S. adults rate the economy as “excellent” or “good,” while 46 percent say it is “poor,” and 39 percent rate it “fair.” The confidence index, which takes into account the net of excellent and good and bad, was -32 for the month. In April, 20% of Americans rated the economy positively, 42% thought it was poor, with a net rating of -22.
Meanwhile, 20% of Americans say the economy is getting better, and 77% say it’s getting worse, about the same as in April and March.
Inflation continues to top the list of U.S. problems
Although not so common During the 2007-2009 recession, when Americans were asked to name without prompting the most important issue facing the United States, the economic question highlighted that 18% mentioned inflation specifically and 12% mentioned the economy in general. Inflation essentially ranks government as the top overall issue, with 19% citing government as the top issue.
Other frequently mentioned issues include immigration, race relations or racism, abortion, the unification of the country, and crime and violence.
Inflation mentions have leveled off since March, with readings rising through the fall and winter months at 17% or 18%. They are still relatively high compared to recent history, but have been high in the past, including 52% in October 1981, 49% in January 1982, and 31% in April 1982, roughly around the rate of inflation When the current level was last reached. Between 1990 and 2021, an average of 1 percent of Americans mentioned inflation.
More generally, the response to the most important issues was similar to April. The main exception is abortion, which has increased from 1% to 5% after the Supreme Court’s draft ruling will be overturned Roe v Wade been leaked. Most of those who mentioned abortion were Democrats or leaning toward the Democratic Party, suggesting that the reaction largely reflected pro-choice Americans’ concerns about overturning the decision, rather than Republicans’ concerns about abortion itself.
The 5% mention of abortion is small in absolute terms, but it is the largest number Gallup has measured on the issue since it began tracking abortion mentions in 1984. Abortion was mentioned by 10% of Democrats and Democratic leaners, which was the top issue along with mentioning inflation (13%) and race relations (10%), but still trailed the administration (17%).
Economic pessimism among Americans worsened this month, which may have been the lowest since the end of the Great Recession. Most other economic factors remained healthy last year, including economic growth, stock values and unemployment, as inflation began to rise. But economic growth contracted in the first quarter, and a similar decline in economic output in the second quarter would put the U.S. in line with economists’ usual definition of a recession. Such a designation could further undermine U.S. economic confidence.
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