Well-Being

Standard-of-Living Perceptions in U.S. Are Slightly Upbeat

Optimism gap between upper- and lower-income Americans may be widening

PRINCETON, NJ -- Americans' perceptions of whether their standard of living is getting better or getting worse were fairly steady throughout 2010. Gallup Daily tracking in December found 45% saying their standard of living was getting better, while 35% said it was getting worse, for a +10 "net improving" score.

Americans' Standard of Living Outlook, January 2008-December 2010

The stability in Americans' outlook for their living standards during 2010 contrasts with the gradual recovery of perceptions in 2009 from the negative outlook that set in shortly after the Wall Street financial crisis erupted in September 2008. Still, Americans ended 2010 less optimistic about their standard of living than they were as 2008 began.

Americans in the highest-income households have consistently been more optimistic about their standard of living than those in the lowest-income households. However, after 2 1/2 years when the paths of optimism among the various income groups were generally parallel, Americans making $60,000 and above maintained their optimism in the second half of 2010, while those making less than $60,000 became less optimistic.

Americans' Standard of Living Assessments -- by Income, 2008-2010

This divergence in the net optimism trends of the highest and lowest income groups can be seen more clearly in the relatively large net optimism gap between the two at the end of 2010. Net optimism among those in households earning at least $90,000 was 26 points in December, compared with 1-point net optimism among those earning less than $24,000. This 25-point gap (and the 24-point gap in November) contrasts with much lower gaps of no more than 20 points since October 2008.

Income Gap in Standard of Living Net "Getting Better" Score, 2008-2010

Bottom Line

Americans' outlook for their standard of living was fairly steady and positive in 2010, although still subdued after a long, slow climb out of the rut it fell into in October 2008. The increased optimism seen in November and December among Americans in the two highest income categories marks a full recovery of these groups from the economic shock created by the Wall Street financial crisis, although their relative optimism is still not as high as it was at the start of 2008.

Key questions for 2011 are whether lower-income groups will soon follow the higher-income groups in feeling more hopeful about their standard of living, and whether upper-income Americans can sustain the increased optimism they expressed in the past two months. The late December extension of the Bush tax cuts into 2011, as well as the reduction in Social Security payroll taxes now taking effect, might be expected to promote greater optimism among both groups. Gallup's initial January standard of living data, available daily on Gallup.com, suggests that may already be occurring.

Survey Methods

Results are based on telephone interviews conducted as part of Gallup Daily tracking Dec. 1- 29, 2010, with a random sample of 26,232 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 sample of 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 and cellular phones, with interviews conducted in Spanish for respondents who are primarily Spanish-speaking. Each daily sample includes a minimum quota of 200 cell phone respondents and 800 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, Hispanic ethnicity, education, region, adults in the household, cell phone-only status, cell phone-mostly status, and phone lines. Demographic weighting targets are based on the March 2010 Current Population Survey figures for the aged 18 and older non-institutionalized population living in 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.

Gallup http://www.gallup.com/poll/145505/Standard-Living-Perceptions-Slightly-Upbeat.aspx Gallup World Headquarters, 901 F Street, Washington, D.C., 20001, U.S.A +1 202.715.3030