A Year of Economic Unease: Long Way to Go to Recover

WASHINGTON, D.C. -- As President Obama delivers a major speech Monday marking one year since the collapse of Lehman Brothers -- an event that quickly spawned a full-scale global economic crisis -- Gallup Daily economic trends document how the crisis hit home for everyday Americans. While Americans over the past six months have become more likely to say economic conditions are getting better, job creation and spending have a long way to go to return to early September 2008 levels.

The accompanying graph documents Gallup Daily tracking trends from Sept. 1, 2008, through Sept. 10, 2009.

• Each of Gallup's economic measures began to deteriorate in the weeks after Lehman Brothers filed for bankruptcy protection on Sept. 15, 2008. Though already high, the percentage of Americans saying the economy was getting worse increased further in the reporting periods after the collapse. Shortly after President Bush signed a $700 billion financial industry bailout into law on Oct. 3, 2008, the "getting worse" percentage tied its previous high of 90% (based on Oct. 6-8 interviewing).
• Americans' views of the job market began to deteriorate in earnest in the late fall of 2008. The percentage of American workers reporting that their employers were letting people go eclipsed the number who said their employers were hiring for the first time since Gallup began tracking this measure in Dec. 1-3 interviewing; little over a week later, the government reported that jobless claims had hit a new 26-year high. Hiring and letting go have remained at similarly negative levels ever since.
• President Barack Obama's inauguration on Jan. 20, 2009, and his signing of the $787 billion stimulus package into law in February brought with them a relative steadiness in Gallup's economic outlook and job-market measures, but the first half of 2009 saw consumer spending fall precipitously from late 2008 levels. While self-reported average daily spending hovered in the mid-$80 to mid-$90 range through much of the initial economic crisis shock waves of September and October, spending declined into the $70 range in mid-November and then, after a temporary holiday season uptick, spending fell further during the first half of 2009, fluctuating mostly in the mid-$50 to mid-$60 range.
• Since late March 2009, generally upward of 30% of Americans have said economic conditions are getting better. While this is up from its post-crisis low of 8% in late September/early October, consumer spending and hiring have not rebounded.
• Americans' reports of the national job-market situation remained gloomy throughout the spring and summer of 2009, but have not deteriorated much further, even as Chrysler and General Motors filed for bankruptcy.
• The back-to-school season did bring temporary increases in self-reported spending, but average daily spending remains far below what it was a year ago.

A comparison of the three-day rolling averages from Sept. 8-10, 2008, to those from Sept. 8-10, 2009, helps to crystallize how far two of these economic measures have to go to return to year-ago levels. While Americans are now 23 percentage points more likely to say the economy is getting better, the percentage of American workers who say their employers are hiring remains down 13 points, while the percentage saying their employers are letting workers go has worsened by 4 points. Consumers' average daily spending is down $21 from the same period a year ago.

While the latest findings reflect only a snapshot in time, the fact that heightened consumer confidence is not yet spurring a recovery in the job market or consumer spending is a phenomenon Gallup has been noting consistently in its weekly economic reports on these measures.

Bottom Line

Gallup Daily tracking trends document precisely when and how the economic crisis has affected the American public over the past year. While Gallup's measures have shown some positive movement in recent months, comparisons to September 2008 underscore that the nation has a long way to go to return to the pre-crisis economic climate, let alone to even healthier economic times.

Keep tabs on the economy by tracking Gallup's consumer confidence, hiring/letting go, and consumer spending measures daily, where users can review and export complete trends dating back to Jan. 2, 2008.

Survey Methods

Results are based on telephone interviews with 1,000 national adults each day, aged 18 and older, conducted Sept. 1, 2008-Sept. 10, 2009, as part of Gallup Daily tracking. Results are reported in three-day rolling averages, encompassing half-samples of approximately 500 national adults each day, for a sample size of approximately 1,500 national adults. For results based on these samples, one can say with 95% confidence that the maximum margin of sampling error is ±3 percentage points.

Interviews are conducted with respondents on land-line telephones (for respondents with a land-line telephone) and cellular phones (for respondents who are cell-phone only).

In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.