Economy

U.S. Economic Confidence Up So Far in November

by Dennis Jacobe, Chief Economist

Consumers more optimistic than in October, despite giving back some post-election optimism

PRINCETON, NJ -- Gallup's Economic Confidence Index averaged -25 over the first three weeks of November -- an improvement from -29 in October and -33 in September. Americans are more optimistic about the U.S. economy now and going forward than they were at this time a year ago.

2009-2010 Trend: Economic Confidence Index, Monthly Averages

The Economic Confidence Index consists of two sets of U.S. consumer ratings: one involving consumers' perceptions of current economic conditions and the other involving their economic outlook.

Over the first three weeks of November, 41% of Americans called current economic conditions "poor" -- down from 44% in October and 47% in September, not to mention the 48% of a year ago.

2009-2010 Trend: Current Economic Conditions, Monthly Averages

The percentage of consumers saying economic conditions are "getting worse" also declined, to 57%, from 60% in October and 62% in September. These expectations for the future direction of the economy are also slightly better than those of November 2009.

2009-2010 Trend: Economic Expectations, Monthly Averages

Post-Election, Post-Fed-Action Optimism Spurt Falls Back a Little

Economic confidence is now at -26, a slight decline from earlier in the month. Optimism had surged to -22 after the midterm elections, a better-than-expected jobs report, and the Federal Reserve's decision to push more money into the economy -- so-called quantitative easing. Confidence remains better than the monthly average for any time since May.

Commentary

The overall improvement in Gallup's Economic Confidence Index during the first three weeks of November suggests Wednesday's Reuters/University of Michigan Consumer Sentiment Index is also likely to show improvement from its October final level. However, the slight worsening as the month continued implies that Wednesday's final November number will be lower than the mid-November estimate. Of course, the small 500-interview sample size of the Consumer Sentiment Index survey always makes estimating its movements, particularly within the month, somewhat challenging.

While American consumers have become less confident in the past couple of weeks, confidence remains better than the average for most of the summer and fall as well as that of a year ago. Combined with Gallup's most recent Christmas sales estimate -- showing at least a modest uptick -- this is good news for the nation's retailers.

Gallup.com reports results from these indexes in daily, weekly, and monthly averages and in Gallup.com stories. Complete trend data are always available to view and export in the following charts:

Daily: Employment, Economic Confidence and Job Creation, Consumer Spending
Weekly: Employment, Economic Confidence, Job Creation, Consumer Spending

Read more about Gallup's economic measures.

Survey Methods

Results are based on telephone interviews conducted as part of Gallup Daily tracking during the three weeks ending Nov. 21, 2010, with random samples averaging from 3,000 to 3,500 adults, aged 18 and older, living in all 50 U.S. states and the District of Columbia, selected using random-digit-dial sampling.

For results based on the total weekly sample of national adults, one can say with 95% confidence that the maximum margin of sampling error is ±3 percentage points. For results based on the total monthly sample of approximately 15,000 national adults, one can say with 95% confidence that the maximum margin of sampling error is ±1 percentage point.

Interviews are conducted with respondents on landline telephones (for respondents with a landline telephone) and cellular phones (for respondents who are cell phone-only). Each sample includes a minimum quota of 150 cell phone-only respondents and 850 landline respondents, with additional minimum quotas among landline respondents for gender within region. Landline respondents are chosen at random within each household on the basis of which member had the most recent birthday.

Samples are weighted by gender, age, race, education, region, and phone lines. Demographic weighting targets are based on the March 2009 Current Population Survey figures for the aged 18 and older non-institutionalized population living in continental U.S. telephone households. All reported margins of sampling error include the computed design effects for weighting and sample design.

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.

For more details on Gallup's polling methodology, visit www.gallup.com.

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